Jane Street Loses $15 Billion After AI Fund Collapse

Jane Street, a Wall Street trading firm, lost approximately $15 billion in July, marking one of its largest monthly setbacks. The loss resulted largely from the failure of Situational Awareness, an AI-focused hedge fund led by former OpenAI employee Leopold Aschenbrenner.

Aschenbrenner had grown Situational Awareness into a $45 billion firm through aggressive bets fueled by borrowing. These positions soured in July, sending the fund into a tailspin. In response to the collapse, Aschenbrenner sold the majority of the fund's stock portfolio to Citadel, the investment firm led by Ken Griffin.

Despite the significant July loss, Jane Street remains in its most profitable year to date, reporting trading revenues that exceed $40 billion.