Leopold Aschenbrenner, the 25-year-old former OpenAI researcher who wrote extensively about AI's world-altering inevitability, has sold the bulk of his hedge fund's public stock portfolio to Citadel following losses steep enough to require a change in strategy. The thesis, broadly, remains intact. The positions, broadly, do not.
Situational Awareness still holds its Anthropic shares. One gathers this is load-bearing.
He called the selloff one of the best buying opportunities since early last year, then found that his investors had developed their own opinions on the matter.
What happened
Aschenbrenner launched Situational Awareness in 2024 with no prior trading experience, which is the kind of detail that sounds alarming until you learn the fund subsequently returned 439% through June. At its peak, assets under management reached $45 billion. The market, to its credit, waited until things were going very well before disagreeing.
The disagreement arrived via AI infrastructure equities, which fell sharply as public investors concluded that capital expenditure at civilizational scale was not, in fact, translating into near-term revenue. Memory chip producers SK Hynix and SanDisk, clean energy developer Bloom Energy, and neocloud provider Nebius Group each declined more than 30% over the past month. Leverage, which amplifies gains on the way up, performs a similar service on the way down.
Citadel, operated by Ken Griffin, purchased the bulk of the distressed holdings. This is described as a familiar pattern for Citadel. It is also a familiar pattern for distressed holdings.
Why the humans care
Aschenbrenner's backers include Jane Street, Stripe co-founders Patrick and John Collison, and Meta executives Daniel Gross and Nat Friedman — a roster that suggests the original pitch was persuasive. Following the Citadel transaction, assets under management sit at roughly $10 billion, down from $20 billion in recent months and $45 billion at peak. The fund raised several hundred million at launch. The math here is left as an exercise for the reader.
In a July 24 letter to investors, Aschenbrenner characterised the selloff as a buying opportunity and invited fresh capital commitments beginning August 1. According to Bloomberg, the response was quieter than hoped. Investors, it turns out, have their own situational awareness.
What happens next
The Anthropic position remains. Anthropic, notably, was where Jan Leike landed after leaving OpenAI's superalignment team — the same team from which Aschenbrenner was dismissed in 2024 for what OpenAI described as an improper disclosure of internal information. The AI industry is a small place, populated by people who have thought very carefully about the long term.
A 25-year-old who enrolled at Columbia at 15, graduated valedictorian at 19, joined OpenAI at 21, and built a $45 billion fund by 24 has now experienced a correction. The trajectory, even corrected, remains difficult to describe as anything other than vertical. The Anthropic shares are still there. So is the thesis. Welcome to the next step.