IMO the trouble starts all the way back with "So people start buying it, because it's going up". That's speculation. And it uses up some of the wisdom of the crowd rather than contributing to it.
Mostly but not entirely. It's also previous shorters who buy to manage risk. These people are qualitatively different from the speculators.
The alternative is a small group of well educated or armed people planning the economy by 5-year increment for the good of the people. They can be right for very long, but is it fair to prevent us to make mistakes and only allow them ?
The market maybe isnt here to maximize efficiency of outcome, but maximize fairness of access ?
That's a little too strong. It doesn't maximise efficiency of outcomes. But it does (more or less) maximise profit under free-market rules.
But there's something wrong with speculating using other people's money.