Why do you think short squeezes happen? It’s not because shorts are being insane and covering. They are literally forced to. You have buying for reasons that aren’t commercial and that’s why short squeezes are so bloody.
edit: originially I said they could carry 200% short, but that is not true. The biggest funds I can find could alone have shorted 30% of a GME at $3 and be okay at $300, but going much above that price or percentage of GME shorted would be a problem.
It seems entirely unsurprising to me that a brick and mortar retailer selling digital goods in the middle of a pandemic would be a hot short target for many different funds, thereby organically pushing short interest over 100%.