The Prodigy Problem
Leopold Aschenbrenner, a former OpenAI employee turned hedge fund manager, saw his AI-focused fund collapse after losing billions. The incident highlights the volatility and speculative nature of the current AI investment boom.
Why it matters
The failure of a high-profile AI fund serves as a cautionary tale regarding the massive capital flowing into unproven artificial general intelligence predictions.
Leopold Aschenbrenner claimed to know the future of AI. His investors lost billions.
Nicholas Albtrecht / The New York Times / Redux September 8, 2026, 7 AM ET Share Save I n the fall of 2007 , as the American housing market began to buckle, a Morgan Stanley bond trader named Howie Hubler lost $9 billion. The bellicose former linebacker believed that he had structured his subprime-mortgage deals in a way that would outsmart the market. Instead, Hubler’s folly amounted to the largest trading loss in history.
Until this summer, that is, when Leopold Aschenbrenner managed to lose nearly four times as much. At age 24.
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