Hedge Fund with $1.11B in Bitcoin Miners Seeks Capital

Situational Awareness has approached investors and lenders for fresh capital after heavy losses in a July sell-off of artificial intelligence-related stocks. The fund holds about $1.11 billion in positions in publicly traded Bitcoin miner companies.

People briefed on the discussions and a July 24 investor letter show the firm sought outside funding and offered some investors the option to buy portfolio assets as it worked to stabilize after the market rout. The size of the losses and the amount of capital being sought were not disclosed. The letter noted the fund had gained 439% after fees through the end of June.

The fund expanded its bets using borrowed money, which increased its exposure and amplified losses when AI stocks fell sharply in July. The investor letter described the sell-off as creating attractive investment opportunities.

A U.S. Securities and Exchange Commission filing in March showed roughly $1.11 billion in positions across seven publicly traded Bitcoin miner stocks, including IREN, Core Scientific, Riot Platforms and CleanSpark. The holdings reflect a strategy focused on power and data-center infrastructure and on miners some investors expect could shift to AI computing.

Situational Awareness was launched in 2024 by Leopold Aschenbrenner, a former researcher at OpenAI. The fund grew rapidly and managed about $20 billion in assets as of early June. Aschenbrenner published essays in mid-2024 predicting that artificial general intelligence machines would outperform college graduates by the end of the decade.

People close to the firm report managers are in talks with existing limited partners and potential lenders to shore up liquidity and allow the firm to hold positions through the weak market. The fund has offered asset sales to some investors and is exploring credit lines and other financing to reduce pressure from margin calls and meet redemption requests.

The fund has not publicly disclosed the full extent of the losses, the identities of lenders approached, or the specific terms under negotiation. Discussions with investors and lenders are ongoing, and the firm did not respond to requests for comment.