Leopold Aschenbrenner’s hedge fund, Situational Awareness, lost approximately 67 percent in July and was forced to sell most of its roughly $16 billion public stock portfolio to Ken Griffin’s Citadel, days after inviting investors to contribute more capital. In a letter to investors first reported by Reuters, Aschenbrenner wrote, “We let you down this month,” took “full responsibility,” and said the fund, launched in 2024, would stop borrowing from banks to amplify public market bets, though it will continue investing in stocks. The fund remains open, and its 439 percent gain through June meant it was still up roughly 80 percent for the year after July’s losses. The forced sale marked the first major setback for the firm, exposing the central risk of his strategy: betting on an AI-infrastructure boom expected to unfold over years, while leverage gave lenders power to force action within days. Only a week before the sale, in a July 24 letter, Aschenbrenner reportedly told investors the selloff had created attractive entry points since early 2025 and offered them the chance to contribute more capital beginning August 1. Instead, losses accelerated on both sides of the portfolio: stocks tied to AI chips, memory, data centers, and cloud infrastructure fell sharply, while short positions against software companies also moved against the fund. Citadel acquired the leveraged portion of the public portfolio; terms were not disclosed.