Market Wrap · August 1, 2026
Citadel Buys $16B in AI Stocks From Aschenbrenner's Fund After a Forced Fire Sale
Situational Awareness LP, the AI-focused hedge fund run by former OpenAI researcher Leopold Aschenbrenner, was forced to sell roughly $16 billion of public equity holdings to Ken Griffin’s Citadel in late July after 4x leverage and a 67% monthly loss triggered margin calls from its prime brokers. Two of the names reported among the holdings sold — SanDisk and Nebius — are also positions in this book, which is the only reason this story belongs here rather than in a general market roundup.
Aschenbrenner launched Situational Awareness in late 2024 with roughly $225 million, built around the AGI-timelines thesis from his own widely circulated essay of the same name. The fund grew explosively on concentrated, leveraged bets across AI infrastructure and semiconductors, reportedly reaching an estimated $45 billion in assets under management by mid-2026 and returning 439% net through June 30, according to CNBC and TechCrunch reporting. In an investor letter dated July 24, Aschenbrenner reportedly called the deteriorating conditions “one of the best buying opportunities” — days before the position had to be unwound entirely.
What actually happened
Reported leverage of roughly 4x amplified a July decline in AI-infrastructure stocks (down over 30% in the month) alongside losses on short positions in software names moving the opposite direction. Bank of America, Goldman Sachs, and JPMorgan — the fund’s prime brokers — issued margin calls as collateral values fell, forcing a rapid liquidation of the fund’s entire public-equity book. Citadel purchased the bulk of it at a discount, cutting the fund’s assets from roughly $20 billion to about $10 billion. Named holdings sold include SK Hynix, SanDisk, Bloom Energy, Nebius Group, and CoreWeave, per CNBC, TechCrunch, and Hedge Fund Alpha’s reporting on Aschenbrenner’s investor letter. The fund reportedly retains a $5 billion private stake in Anthropic, along with stakes in chipmaker MatX and data-center startup Fluidstack.
For this book specifically: SanDisk is the largest position here, currently 7.94% of the portfolio and flagged Under Review on the Compliance Ledger; Nebius is a smaller Emerging Growth–bucket position. A large, leveraged fund being forced to sell a name is a real, mechanical source of short-term selling pressure — distinct from anything about the underlying business — and it cuts both ways: it says nothing about whether the NAND-pricing or AI-infrastructure theses behind these positions are still intact, only that one large holder of the same names was a forced, non-fundamental seller in late July. I'm not treating this as confirmation or refutation of either thesis; it's a supply-side data point worth naming plainly rather than ignoring because it doesn't fit a tidy narrative either way.