I don't get it. The volume of shorts in the markets is a dynamic quantity right? In the absence of new transactions, these shorts would disappear when the share

I don't get it. The volume of shorts in the markets is a dynamic quantity right? In the absence of new transactions, these shorts would disappear when the shares are physically transferred. Therefore, the risk here is counterparty risk, but I don't see this risk as being peculiar to ETFs right? Furthermore, once you have settled and obtained ownership, the risk is gone right?