Chronology of Massive Investor Losses: Rp810 Trillion in Assets in Disarray
The hedge fund owned by former OpenAI researcher Leopold Aschenbrenner has reportedly suffered enormous losses after its investment strategy in the artificial intelligence (AI) sector turned into a boomerang. The fund, which previously managed assets of up to US$45 billion (approximately Rp810 trillion), is now forced to divest its entire public equity portfolio.
This situation was triggered by a slump in AI infrastructure stocks, which were the cornerstone of its investments. Simultaneously, bets that software company stocks would decline failed to materialise, exacerbating the losses suffered by the hedge fund Situational Awareness. Pressure has intensified as the firm faces margin calls from its creditors. Several investment banks are currently assisting in the sale of the company’s assets, while Ken Griffin’s Citadel hedge fund has reportedly reached an agreement to acquire Situational Awareness’s entire public stock portfolio.
According to sources familiar with the matter, banks and brokers partnering with Situational Awareness are attempting to raise cash to help the hedge fund meet its margin calls—the obligation to provide additional collateral when the value of leveraged investments drops sharply. Amidst this pressure, Citadel has reportedly struck a deal to purchase the entirety of Situational Awareness’s public equity holdings.
One primary cause of the losses was the falling share price of several companies central to the fund’s strategy, including the South Korean memory chip manufacturer SK Hynix. At the same time, investment positions intended to profit from the decline of software companies, such as Adobe, resulted in losses as those share prices actually rose.
According to CNBC sources, Situational Awareness managed up to US$45 billion in assets as of early July. However, within just a few weeks, its investment value plummeted sharply. Major investment banks, including Bank of America, Goldman Sachs, and JPMorgan Chase, are now assisting the firm in gradually reducing its holdings to prevent the asset sales from further depressing market prices. It remains uncertain whether these sales will be sufficient to cover all the margin call obligations facing the firm. While there were rumours that Situational Awareness was exploring the sale of its stake in the AI company Anthropic, a company spokesperson has denied that those shares are being marketed.
Aschenbrenner became one of the most closely watched figures in the AI investment world after leaving OpenAI in 2024. He believed that AI advancements would trigger a surge in demand for chips, semiconductors, data centres, and electricity supply, making these sectors major investment opportunities. This strategy initially yielded fantastic profits, allowing Situational Awareness to expand rapidly.
According to regulatory documents from the end of the first quarter, the hedge fund’s largest investments were in Nebius Group, Sandisk, Micron, and CoreWeave. However, throughout this month, all these stocks have plummeted by more than 35%.
Aschenbrenner, 25, is a top graduate of Columbia University. He joined OpenAI’s Superalignment team at the age of 19. He was dismissed from OpenAI in 2024 following allegations of leaking internal company information. Aschenbrenner has denied these allegations, stating that the documents shared with external researchers were not confidential, but rather materials for discussing AI development safety. While the exact scale of the losses suffered by Situational Awareness remains unknown, this volatility serves as the greatest test for an AI investment strategy previously regarded as one of Wall Street’s most spectacular success stories.