Situational Awareness, the hedge fund founded by former OpenAI researcher Leopold Aschenbrenner, has reportedly sold most of its public stock holdings to Citadel after sharp losses in AI infrastructure investments. The sale marks a setback for a fund that had rapidly grown on bets that the AI boom would drive demand for chips, computing power, memory and energy, while highlighting the risks of leveraged investing during a sector downturn.

The fund had returned 439% by June and reportedly managed as much as $45 billion at its peak, but its assets are now estimated at about $10 billion after the sell-off. Holdings including SK Hynix, SanDisk, Bloom Energy and Nebius Group fell more than 30% over the previous month as investors questioned whether heavy AI spending was producing sufficient near-term revenue; however, Situational Awareness reportedly retained its private investments, including an Anthropic stake valued at around $5 billion.