It's possible; it's called naked short selling. The only reason people actually think it might have happened is because of widespread accusations on reddit. These accusations are financially illiterate and deluded conjecture, but they're stated with utter conviction so a lot of people find them convincing.
There isn't actually any evidence the named hedge funds were engaged in naked short selling. For the most part, people seem to misinterpret short interest and failure to deliver data as an indication naked short selling occurred.
There isn't actually any evidence the named hedge funds were engaged in naked short selling. For the most part, people seem to misinterpret short interest and failure to deliver data as an indication naked short selling occurred.