If you bought BTC at $1200, then that was your choice. It is your problem. It isn't the market's problem.
If you don't mind exchanges allowing other people to sell your bitcoins, then good for you. I suspect others would be concerned.
First you say the market makers get to sell their bitcoins instead of the someone on the exchange and now are saying the exchange would sell your bitcoins. You seem confused.
The fact is short selling isn't anything new and it is a normal part of most markets. Just because you don't understand how it works, doesn't make it a scam. If you short sell something you have to cover it at some point and it can be highly risky for the short seller.
+1
No difference IRL. If you hold your money in a bank account, do you really think they keep it safe? I remember how the financial crisis (pick any of them) happened... Banks use your money to make profit and in worst case you even pay an account fee to them.
BTC Markets are well alive and nobody forces you to sell your *coin for less than it's worth to you.
The fact that there are no lawful regulations doesnt make it a scam.