The person loaning out their shares gets paid for the risk. In this case the investors were effectively conned into being the counterparty on a call option on ETH for no vig.
In straight short selling, no you don't. Your broker gets paid though.
But your broker is on the hook for the difference if you decide to sell. In that instance they're taking the profit but also the risk. The issue here is that this guy found a way to make someone unwillingly take the risk.