$45 Billion AI Fund Collapses in Days, Leaving Crypto Investors Concerned

Leopold Aschenbrenner's $45 billion AI fund, Situational Awareness, collapsed in July 2026 after its positions fell between 35% and 47%. The fund's leveraged longs in AI infrastructure names, including SK Hynix, CoreWeave, and Micron, were hit hard as investors questioned the returns on hyperscaler capital expenditure. Prime brokers issued margin calls that the fund couldn't meet, leading to a forced sale of its entire public equity book to Citadel at a discount.

The collapse is significant for crypto readers because it involved familiar mechanics: concentrated leveraged longs, a price decline, and a well-capitalised buyer waiting to take the other side. The fund's failure also reveals that several crypto-native companies are now carrying AI infrastructure risk directly on their balance sheets.

Aschenbrenner, 22 at the time of the fund's inception, was a former OpenAI researcher who had raised concerns about the company's security practices before being dismissed in April 2024. He turned his essay, 'Situational Awareness: The Decade Ahead,' into a fund that attracted capital from prominent investors like Stripe co-founders Patrick and John Collison.