The man who wrote the defining case for the AI boom just got wiped out betting on it. Situational Awareness, the hedge fund founded by former OpenAI researcher Leopold Aschenbrenner, has been forced to sell off its portfolio of public stocks after steep losses. Ken Griffin’s Citadel has bought the lot.
The collapse was first reported by CNBC’s David Faber. The fund’s prime brokers had been scrambling to raise cash to meet margin calls, he said. The whole public book went in one enormous trade. Roughly two-thirds of the fund’s assets were public equities, held long and shorted. The Wall Street Journal reported that the rival firm Millennium had also bid for the book.
The trade that broke
The fund made one big, leveraged bet: that the AI build-out would keep lifting the companies supplying its chips, memory and power. That trade turned hard. Its positions in memory maker Micron, SK Hynix, Sandisk, Nebius and CoreWeave unravelled fast.
The damage was brutal. Nebius, where the fund disclosed a multi-billion-dollar stake in May, has fallen about 48 per cent from its peak. That erased roughly $35bn in market value. Sandisk is down 56 per cent in barely a month. The fund had also bet against software, and shorts in names like Adobe moved the wrong way, squeezing it from both sides.
