Leopold Aschenbrenner’s hedge fund, Situational Awareness, has been hit by liquidations after a fast downturn in AI stocks punished its leveraged positions.
Aschenbrenner, a former member of Sam Bankman-Fried’s FTX Future Fund team, launched the fund in 2024 and had run it up 1,000% by May of this year. CNBC reported Thursday that Situational Awareness had suffered “heavy losses,” needed cash to meet margin calls, and was consulting investment bankers about 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 Financial Times, citing a July 24 investor letter, said the fund was allegedly up 439% net of fees from January 1, 2026 through June 30. Then July changed the picture.
According to Protos, Aschenbrenner had borrowed money to increase his AI bets, including positions in Sandisk, Nebius Group, and SharonAI Holdings. Each of those names lost at least 30% during July. Leverage amplified gains on the way up and did the same to losses on the way down. The report said a 3x leveraged portfolio made up only of those three stocks this month would have been wiped out to $0.
From FTX Future Fund to an AI-focused hedge fund
Before he borrowed money for stock trading, Aschenbrenner had built a reputation on AI bets that outperformed before July. Earlier, he had been part of the five-person team that ran the FTX Future Fund.
The Future Fund was an effective altruism grant-making vehicle. Bankman-Fried largely funded it himself, using money that prosecutors later proved had been misappropriated from FTX customers in part. Aschenbrenner joined when the vehicle launched in February 2022 and resigned on November 10 that year, one day before FTX filed for bankruptcy.
His FTX-linked work collapsed alongside FTX and Alameda Research after prosecutors exposed Bankman-Fried’s fraud. In comments to the Dwarkesh Podcast, Aschenbrenner said, “We were a tiny team, and then from one day to the next, it was all gone and associated with a giant fraud.”
OpenAI exit and the launch of Situational Awareness
After his work tied to FTX’s effective altruism efforts ended in 2022, Aschenbrenner joined OpenAI’s Superalignment team. By April 2024, OpenAI had fired him over a disputed data leak.
He then turned that ousting into a viral manifesto, Situational Awareness, and launched a fund under the same name with a few hundred million dollars.
Before this month’s drawdown, the fund’s mark-to-market valuation had looked striking. Protos said Situational Awareness had grown its starter capital into an alleged $20 billion in assets by June, based on short-lived highs in AI stocks last month. The report added that this valuation is far from what investors would actually receive if they tried to withdraw now.
Anthropic stake and concentrated AI exposure
Protos wrote that, “like Bankman-Fried taught him,” Aschenbrenner bought a stake in AI company Anthropic. That holding grew to roughly one fifth of Situational Awareness’ assets.
Concentrated allocations combined with leverage can produce oversized returns in rising markets and equally large losses during downturns.
Situational Awareness also held major AI stocks, including SK Hynix’s US listing. Those ADR shares closed Wednesday about 15% below their US offering price.
The Financial Times, citing Aschenbrenner’s investor letter, reported that the fund had “not been immune” to market swings, particularly in Asia. Even so, he argued that the selloff had created attractive buying opportunities.
Latest SEC filing still reflects March holdings
Aschenbrenner had previously said that he invested almost all of his personal net worth in the fund. Now, after another crash, Protos wrote that the former FTX-linked philanthropist is seeking more money.
The latest SEC disclosure of the fund’s US holdings covered positions as of March 31, 2026. That filing listed 42 holdings worth $13.7 billion.
The next 13F is due in mid-August and is expected to show the precise scale of the fund’s July drawdown.