The price will crash. No one knows when hype will die out and people will stop jumping on the bandwagon, but I'm sure those hedge funds that are covering their short positions aren't going to stick around for the fall.

This makes no sense. The hedge funds that cover their shorts are the ones taking the fall; entering a short at $20 and exiting at $300 is the fall.

Aren't there going to be multiple falls here. The one you mentioned and when the stock falls back to its "real" value?

Gamestop isn't going to stay at $300. You seriously don't think its going to crash back down to reality? The only ones still in the stock during the fall will be retail investors. So yes, the hedgefunds were hurt, but there will be a lot of pain for the retail investors that jumped on the bandwagon too late and don't get out soon enough.

Trading stocks is not a zero-sum game, at least not in the way implied here.

Those hedge funds covering their short positions have already acknowledged their fall by covering. The whole point of the short is sticking around for the fall.

I mean the fall from the current extremely high price to a reasonable valuation. Retail investors will be the only ones left carrying the bag when that happens.