📰 Key Highlights

Citadel acquired most of the public stock portfolio of hedge fund Situational Awareness (founded by former OpenAI researcher Leopold Aschenbrenner), after the fund suffered major losses in July’s AI stock rout. The catalyst: Aschenbrenner’s fund lost roughly 67% in July (per the Wall Street Journal citing investor letters), though the letter also noted it was still up about 80% year-to-date; the Financial Times had previously reported the fund was up 439% as of the end of June. Reports indicate Situational had already sought fresh capital from existing investors and lenders, offering some investors the option to buy portfolio assets; the WSJ also noted the fund needed cash to meet margin calls from lenders, and had agreed late Wednesday to sell a $3.5 billion Anthropic stake to a group led by Greenoaks and Sequoia Capital—only to pull the deal Thursday morning. Reuters reported details of the leveraged portfolio but could not confirm whether a formal margin call had been issued before the sale; Reuters also noted Situational retained roughly $10 billion in stocks and private investments, including Anthropic shares. In July, several stocks tied to the fund plunged: Sandisk dropped about 44% for the month, CoreWeave fell nearly 26%, and Bloom Energy dropped about 32%. The fund’s SEC filings as of March 31 showed it also held around $1.11 billion in shares across seven Bitcoin mining companies—including Iren, Core Scientific, Riot Platforms, and CleanSpark—signaling a bet on miners pivoting to AI and high-performance computing. It’s still unclear which stocks are involved in the Citadel deal, or whether the fund has retained any Bitcoin miner holdings.

💬 JudyAI Lab Take

Citadel picked up most of Situational Awareness’s public stock portfolio—a fund founded by a former OpenAI researcher that got hammered in July’s AI selloff.

Going from up nearly 439% YTD to losing 67% in a single month tells you everything about how AI-narrative-driven rallies often come stacked with high leverage and concentrated positions. When the tide turns, the unwind happens way faster than anyone expects. Reports say the fund agreed to sell $3.5 billion in Anthropic shares to cover margin calls, then yanked the deal the next day—the liquidity pressure is written all over that. Whether it’s AI concept stocks or miner-pivot stories, it’s the leverage structure that really decides who survives.

When you see AI-related names ripping, it’s worth asking: how much of that move is leveraged?

📅 Source Info

🔗 Further Reading