PalacioHill

Someone holding the short end of an option isn't exposed to credit risk (from the short position) because they're not depending on the long for additional payment.

The short already received payment when they wrote the option. All that's yet to be determined is whether or not the long exercises the option. If the long exercises (which will only happen in the money), the short loses some $. If the long does not exercise (for whatever reason) nothing happens and the short keeps the premium.

Either way they're not depending on the long to deliver anything else of value, so they're not exposed to credit risk.