FT's new piece on Situational Awareness.

They had concentrated billions in AI-linked stocks and borrowed against the portfolio， so falling prices weakened both its capital and lenders' collateral.

As lenders pressured it to raise capital or reduce exposure， selling into the decline crystallized losses and weakened the remaining collateral.

Citadel acquired most of the roughly $16B public book， particularly broker-financed positions， while Situational retained Anthropic and other private stakes.

The transaction exposed a clear financing failure. A multi-year technology view had been financed with borrowing that prime brokers effectively reassess every trading day.

That mismatch left little room for recovery once correlated AI holdings fell together， turning market volatility into a forced transfer of assets.