Situational Awareness seeks capital after AI stock sell-off, FT says
FT says Leopold Aschenbrenner’s hedge fund sought fresh backing after leveraged AI bets, including Bitcoin miners, were hit in July.
By Sofia Marchetti · Columnist
· 3 min read
Situational Awareness is seeking capital after July’s sell-off in artificial intelligence stocks hit the hedge fund’s leveraged bets, the Financial Times reported Thursday. For retail investors watching the AI trade spill into crypto-linked equities, the report shows how Bitcoin miners have become tied to the same data-center and power story driving AI stocks.
The Financial Times said the fund, founded in 2024 by former OpenAI researcher Leopold Aschenbrenner, has approached investors and lenders for new money. The newspaper cited people briefed on the talks and a July 24 investor letter.
The amount of capital sought was not disclosed, and the Financial Times did not report the size of the losses. The fund also offered some investors a chance to buy assets from its portfolio, according to the FT.
Why is Situational Awareness seeking capital?
The Financial Times reported that borrowing magnified the fund’s losses when AI stocks fell during July’s market rout. In investing, borrowing to increase the size of a position is called leverage. It can boost gains when a trade works, but it can also make losses grow faster when prices move against the investor.
According to the investor letter cited by the FT, Situational Awareness had returned 439% after fees through June. The newspaper also reported that Aschenbrenner argued in the letter that the sell-off had opened up attractive opportunities for new investments.
The Wall Street Journal previously reported that Situational Awareness had about $20 billion in assets under management as of June 8. Assets under management means the total amount of investor money and portfolio value a firm oversees.
How Bitcoin miners fit into the AI trade
Situational Awareness has placed a large bet on the infrastructure behind artificial intelligence, according to earlier reporting from Cointelegraph. That theme includes power generation, data centers and Bitcoin mining companies that are shifting some capacity toward AI computing.
A March filing with the US Securities and Exchange Commission showed roughly $1.11 billion in positions across seven Bitcoin miner stocks. The filing listed holdings that included IREN, Core Scientific, Riot Platforms and CleanSpark.
Bitcoin miners are relevant to AI investors because many already operate energy-intensive computing sites. Some miners have been trying to use that infrastructure for AI workloads, which require large amounts of electricity and data-center capacity. That link can make their shares sensitive to both crypto-market expectations and demand for AI computing infrastructure.
Aschenbrenner became known in AI circles after writing a series of essays in mid-2024 about artificial general intelligence, around the time he launched Situational Awareness. In those essays, he predicted that AGI systems would exceed college graduates’ capabilities before the end of the decade.
Cointelegraph reported that it contacted Situational Awareness for comment and had not received a response by publication.
This story draws on original reporting from Cointelegraph.
