Situational Awareness Seeks Capital After AI Stock Sell-Off Wipes Out Gains

A hedge fund with significant exposure to Bitcoin miner stocks is seeking fresh capital after suffering heavy losses in the recent AI stock sell-off. Situational Awareness, founded by ex-OpenAI researcher Leopold Aschenbrenner in 2024, has approached investors and lenders for capital injections.

The fund had gained 439% after fees through June, but its borrowing increased the size of its bets, leading to significant losses when AI stocks collapsed during July's market rout. Aschenbrenner argued in a recent investor letter that the sell-off created attractive investment opportunities.

The fund has around $20 billion in assets under management and had invested approximately $1.11 billion across seven Bitcoin miner stocks, including IREN, Core Scientific, Riot Platforms, and CleanSpark. Aschenbrenner previously predicted that AGI machines will outpace college graduates by the end of the decade.