AI Hedge Fund Situational Awareness Plunges 67% in July, Forced to Liquidate to Citadel

Situational Awareness NAV drops 67% in July, triggering forced sales to Citadel for margin calls. Despite losses, the fund remains up 80% YTD after prior 270% gains.

Woofun AI reports that Situational Awareness, a hedge fund founded by former OpenAI researcher Leopold Aschenbrenner, experienced a 67% decline in net asset value during July. The fund was compelled to liquidate most of its AI stock holdings to satisfy margin calls, with Citadel acquiring a significant portion of these assets. Aschenbrenner attributed the losses to exacerbated short selling and described the situation as resembling a "run on the bank." Although the fund previously achieved gains of up to 270% by the end of May, it remains up approximately 80% year-to-date. Established roughly two years ago, the fund once managed over $20 billion in assets and continues to hold investments in private AI companies such as Anthropic.