This was the entire basis of the GameStop stock price jump.
A bunch of gamers decided to buy stock up to nail the short traders costing some of them billions at one point. So you had a bunch of people saying “This isn’t right.” and buying a couple of thousand dollars of stock to cost institutional investors a few hundred million.
Naked short selling is about the dumbest thing you can do because there is no limit to how much money you can lose. If you short a stock at $20, current market price is $50 if the stock goes to $200 you’re out $180 a share. This can’t go on indefinitely because of margin calls. Sometime in the not too distance future someone is going to come looking for you to cover your shorts.
If this became political all it would take is 5,000,000 retail investors to hurt these 4 institutional investors harder than any regulator ever good.