What smart people are saying about the Situational Awareness stock sell-off to Citadel

• Leopold Aschenbrenner’s AI-focused fund sold most of its stock portfolio to Citadel.
• The sale came after Situational Awareness experienced major losses in AI-related positions.
• Investors are weighing in on what it says about Wall Street and trading in AI.

“It’s the saddest, most Machiavellian thing. But he sort of had to blow up. There’s no other ending. Because of the leverage level,” he said.

He also said he thinks Aschenbrenner is “brilliant” and could still have a future in investing despite this being an “extremely humbling moment.”

“He’ll be back and successful,” he said.

Christian Keil, partner at Andreessen Horowitz

Christian Keil, partner at Andreessen Horowitz, chimed in on why he thought Aschenbrenner’s story was eliciting such a strong reaction online.

“People love a good downfall,” he wrote on X. “Gives them a nice little excuse for why they never had a meteoric rise of their own.”

Hank Medina, founder of Litquidity

Hank Medina, founder of Litquidity, the popular financial account on X and investment company, summed up the story by comparing Aschenbrenner, who is in his early 20s, to Griffin, a seasoned vet on Wall Street.

“This is what happens when a tech bro tries to play hedge fund manager,” he wrote on X. “He gets blown up by leverage and ripped to shreds by a seasoned financial juggernaut who strikes when there’s blood in the water,”

Tom Shaughnessy, founding partner at Delphi Ventures

Tom Shaughnessy, a founding partner at the tech investment firm Delphi Ventures, defended Aschenbrenner.

“Dunking on leopold is ridiculously stupid,” he wrote on X. “He left OpenAI, had a thesis, raised a fund, executed against it aggressively and moved some serious capital around.”

“Respect to those in the arena everyone else is a keyboard warrior,” he added. “Take more risk.”