Leopold Aschenbrenner, a former OpenAI researcher, watched his AI-focused hedge fund, Situational Awareness, collapse after a brutal sell-off in semiconductor stocks and margin calls from Wall Street. According to insiders, the fund managed a staggering $45 billion in assets earlier this month, but by Thursday, its holdings had plummeted to roughly $10 billion after being forced to sell leveraged stock positions—including heavily hit names like SK Hynix and CoreWeave—at a discount to Ken Griffin's Citadel.
The swift rise and sudden fall of Aschenbrenner has captivated both Wall Street and the tech world, making him a high-profile casualty of the volatility surrounding the AI boom. A controversial figure, his online followers viewed the 19-year-old Columbia University valedictorian as a prodigy, tracking his fund's quarterly filings for clues on the hottest AI stocks.
Before this month's downturn, Situational Awareness had generated returns of over 1,000% since its inception. Critics, however, noted Aschenbrenner had no prior experience managing money before founding the fund in July 2024, suggesting his success was more about luck than skill. Some pointed to his early career at the now-defunct crypto exchange FTX, where he helped run a charity for the disgraced founder Sam Bankman-Fried from a penthouse in the Bahamas.
Other Wall Street players, including former traders at global investment banks, said the collapse was unsurprising given reports that Situational Awareness used leverage of up to 400%. The head of a Wall Street training firm remarked that many saw this blow-up as inevitable, adding that while Aschenbrenner's long-term thesis on AI may be correct, short-term preparation is critical in the public markets.
Earlier this week, just before the sale to Citadel, sources said roughly two-thirds of the fund's holdings were in public stock long and short positions, with the remainder in private company equity, largely a multi-billion dollar investment in Anthropic.
The near-collapse of Situational Awareness coincided with the hedge fund manager's wedding weekend. Aschenbrenner is engaged to Avital Balwit, the chief of staff to Anthropic CEO Dario Amodei.
Born in Germany to physician parents before moving to the U.S., Aschenbrenner showed early talent in math and computer science, according to profiles and podcast interviews. He skipped grades in the German education system, graduated high school at 15, and gained attention in his teens at Columbia University for an academic paper titled "Existential Risk and Growth."
A Columbia classmate said she hadn't heard of Aschenbrenner before meeting him on Zoom prior to his 2021 graduation. She described him as "childish" and socially awkward in their interactions. Aschenbrenner has since said his personality—which he calls intellectually "quirky" and "unlikable"—was suppressed by German culture, but he has come to view it as a strength.
During his time at Columbia, he co-founded the school's chapter of "Effective Altruism," a philosophy popular in certain tech circles that encourages founders to earn as much money as possible to help humanity. This network became his career pipeline, eventually leading him to work with Bankman-Fried, another effective altruism advocate, after graduating in 2021. He spent some time at FTX's charitable arm, the Future Fund, before the crypto company collapsed.
In 2023, Aschenbrenner joined OpenAI's Superalignment team, working under Ilya Sutskever on aligning AI with human interests. After a hacker breached OpenAI's internal systems, he wrote a memo to the board warning that company security was insufficient to stop foreign espionage, specifically mentioning China. In 2024, the company fired him after accusing him of improperly sharing confidential information, a claim he disputed, stating he was raising concerns about the company's security practices.
A computer scientist who worked on AI safety at OpenAI expressed regret that Aschenbrenner was pushed out, saying he was trying to do the right thing and the company overreacted. An OpenAI spokesperson declined to comment.
Weeks after leaving OpenAI, Aschenbrenner turned his brief stint at a leading AI company into a grand vision for artificial intelligence and the world's direction. His June 2024 essay argued that general artificial intelligence could arrive within years and that the government had severely underestimated the pace of progress. Admirers saw this as proof that Aschenbrenner was a genius with valuable insight into AI's trajectory, while critics accused him of exaggerating the technology's short-term capabilities and his own certainty about the future.
In July 2024, Aschenbrenner leveraged his growing fame into seed capital for his hedge fund, reportedly raising $225 million from Stripe co-founders Patrick and John Collison, former GitHub CEO Nat Friedman, and investor Daniel Gross. This marked the start of an unprecedented two-year run in recent Wall Street history. "Soon enough, the world will wake up," Aschenbrenner wrote at the time, adding that only a few hundred people in the AI community knew what was coming. "If their view of the future is anywhere close to correct," he wrote, "we are in for a wild ride."
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