AI hedge fund Situational Awareness is forced to sell most of its portfolio to Citadel

Situational Awareness, the AI-focused hedge fund founded in 2024 by former OpenAI researcher Leopold Aschenbrenner, has reportedly sold the bulk of its public stock portfolio to Ken Griffin’s Citadel. The forced sale followed margin calls tied to roughly four-times leverage, according to people familiar with the fund.

The reversal is one of the sharpest to hit the AI market boom. The fund’s assets peaked near $45 billion in early July 2026 after a 439% year-to-date return through June, before the forced sale cut them to roughly $10 billion.

Its hardest-hit long positions reportedly included Micron, SK Hynix, Sandisk, Nebius and CoreWeave, several down 30% to 56% in a month amid a broad AI-stock selloff. Early backers included Jane Street, Stripe co-founders Patrick and John Collison, and investors Daniel Gross and Nat Friedman.

The fund kept its private stake in Anthropic, valued at roughly $5 billion, which was not caught in the public-market unwind. Anthropic was last valued at $965 billion in a May 2026 Series H round, so the position remains a large paper cushion against the trading losses.

Aschenbrenner, who left OpenAI’s now-disbanded Superalignment team, built the fund on a thesis that AI would remake the economy. The episode shows how that conviction, geared up with heavy leverage, turned a concentrated AI bet into a liquidity trap the moment the stocks turned.