Aschenbrenner Fund Drops 67%, Sells to Citadel
Get the Finance newsletter
Daily finance — markets, central banks, M&A, the prints that move money. Free.
- Situational Awareness lost an estimated 67% in July 2026 yet remains up roughly 80% year-to-date, according to a person close to the firm.
- Aschenbrenner told investors the fund sold the bulk of its public equities to Citadel in a block trade on Wednesday night/Thursday morning to meet collateral demands and remove all leverage.
- The fund, launched in early 2025 with less than $1 billion, had swelled to $45 billion at the start of July before the meltdown.
- Borrowed money had juiced concentrated bets on SanDisk, SK Hynix, and CoreWeave, all of which slumped this month.
- All shorts were closed and reliance on portfolio financing was removed, but the fund held on to its private Anthropic stake.
- In his letter, Aschenbrenner described 'bank run' dynamics as adverse trading in names publicly associated with the fund amplified losses.
- A former OpenAI researcher who had never managed money before launching the fund, Aschenbrenner took full responsibility and pledged structural changes across portfolio management and risk.
Why it matters: A first-time manager with no prior money-management experience grew $1 billion into $45 billion in roughly 18 months using leverage, then watched a 67% July drawdown force a block sale to Citadel — a live demonstration that even a thesis-driven AI bull fund can become a forced seller when names like SK Hynix, SanDisk, and CoreWeave reverse violently. The fund's pivot to a fully-paid-for public book and risk-team overhaul underscores how leverage, not bad calls, can be the thing that breaks a winning streak.
