You bring up a very valid point. With only 21M BTC total available, will the shorting crowd simply overwhelm the entire sector?
This is one thing that concerned me. There is nothing to stop Wall Street from creating as many shorts as they want and doing it naked too.
One thing to offset is the fact that many of the hedge fund set up so far are going to buy the actual tokens. That might not be the case as more funds open up in the future. That market, too could get overwhelmed.
We know there are instances where they were able to manipulate the gold and silver markets, two such markets that are much bigger than BTC.
It could get very ugly.
The gold and silver manipulation occur at the Comex. It has even been demonstrated in a court of law that the comex is rigged. When sentencing occurred, JP Morgan was relieved of all responsibility for their actions, the justification being that they are operating as an agent of the Government!
To be clear, what they are doing is shorting the paper derivative and buying cheap physical silver, then creating more paper derivatives out of that recently acquired physical silver.
You cannot fake Bitcoin, so anyone institutional or individual is a fool to play the futures market with an asset as rock solid as Blockchain assets. Their whole game is based off of fake derivatives and we need to make sure to be spreading the word about how that is NOT the real Bitcoin or ANY real blockchain asset, so that people know what they are participating in. Good luck cashing out ANY paper derivative in a financial crash.