Leopold Aschenbrenner, the founder of hedge fund Situational Awareness, has seen his leveraged positions liquidated following a swift downturn in AI stocks.
Aschenbrenner, a former member of Sam Bankman-Fried’s FTX Future Fund team, launched his fund in 2024 and ran it up 1,000% by May this year.
However, CNBC reported Thursday that Situational Awareness had suffered “heavy losses,” needed cash for margin calls, and was consulting with investment bankers for the possibility of an orderly wind-down.
By midday, the Wall Street Journal reported that Ken Griffin’s Citadel had bought “the bulk of its stock portfolio.”
The fund was allegedly up 439% net of fees from January 1, 2026 through June 30 per a July 24 investor letter the FT cited. Then July happened.
Aschenbrenner had borrowed money to upsize his AI bets, including Sandisk, Nebius Group, and SharonAI Holdings that have each lost at least 30% during the month of July.
Leverage that multiplies gains on the way up does the same to losses on the way down. Holding a 3x leveraged portfolio in just those three stocks this month would have wiped out to $0.
Although Aschenbrenner gained notoriety for his outperforming AI bets prior to July, before he borrowed money for stock trading, he sat on the five-person team running the FTX Future Fund.
It was an effective altruism grant-making vehicle. Bankman-Fried funded it largely himself, partially using money that prosecutors proved he misappropriated from FTX customers.
Aschenbrenner joined at the vehicle’s launch in February 2022 but resigned on November 10 that year, one day before FTX filed for bankruptcy.
Another effective altruist needs more money
Aschenbrenner’s FTX Future Fund collapsed alongside FTX and Alameda Research after prosecutors exposed Bankman-Fried’s fraud.
“We were a tiny team, and then from one day to the next, it was all gone and associated with a giant fraud,” Aschenbrenner told the Dwarkesh Podcast.
After ending work with FTX’s effective altruism in 2022, Aschenbrenner went to work for OpenAI’s Superalignment team.
However, by April 2024, OpenAI had fired him over a disputed data leak. He turned the ousting into a viral manifesto, Situational Awareness.
He launched a fund of the same name with a few hundred million dollars.
Read more: FTX-funded charity Effective Ventures to shut down in the UK
The mark-to-market valuation of his hedge fund was certainly impressive prior to this month. Situational Awareness grew starter capital into an alleged $20 billion worth of assets by June, based on fleeting highs in AI stocks last month.
That valuation is nothing close to what investors in Situational Awareness will actually receive if they tried to withdraw today.
Buying Anthropic just like SBF taught him
Like Bankman-Fried taught him, Aschenbrenner bought a stake in AI company Anthropic, which grew to be worth roughly one fifth of Situational Awareness’ assets.
Concentrated allocations plus leverage can create outsized returns on the way up and equally outsized losses during downturns.
Situational Awareness was an investor in major AI stocks, includingin SK Hynix’s US listing. Those ADR shares closed Wednesday about 15% below their US offering price.
Aschenbrenner’s investor letter admitted the fund had “not been immune” to the swings, particularly in Asia, per the Financial Times. Yet he insisted the selloff had created attractive buying opportunities.
Aschenbrenner previously claimed to have allocated almost all of his personal net worth invested into his own fund. Now, after another crash, the ex-FTX philanthropist is asking for more money.
Situational Awareness’ latest SEC report of its US holdings disclosed names as of March 31, 2026. The filing listed 42 positions worth $13.7 billion. The next 13F lands in mid-August, and it will specify the precise drawdown in July.
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