It appears the short disappeared once the placement stock was past the 4 month date of 8/22. So it was a hedge as I anticipated, a financial investor. Long at $1.35, short above $1.35, and risk is off the table. They own the 1/2 a lottery ticket at $1.70, the warrant exercise price. So they will likely trade the stock around $1.70 now. Short above $1.70, bid below to cover their short.

It is a good thing there aren't many investors that participated in the placement like this.