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Leopold Aschenbrenner’s Situational Awareness thesis argues AGI will arrive by 2027 through compounding gains in compute scaling (~0.5 OOMs/year), algorithmic efficiency (~0.5 OOMs/year), and capability “unhobbling” (transforming chatbots into autonomous agents). This thesis underpins Situational Awareness LP, which grew from $225M to $5.5B in disclosed equity exposure in just over one year, returning +47% net of fees in H1 2025.
The fund’s critical insight: the binding constraint on AI progress is shifting from GPUs to power and physical infrastructure. By 2028, individual training clusters may require $100B+ in investment and consume power equivalent to a small U.S. state. Securing permitted, grid-connected power takes 5-7 years — making existing power assets enormously valuable.
1. From Chips to Infrastructure
The Q4 2024 13F showed a semiconductor-heavy portfolio (NVIDIA, Intel, Broadcom). By Q4 2025, the fund pivoted wholesale to the infrastructure layer — power generation, data center real estate, and connectivity. NVIDIA puts worth $300M were sold; positions in Bloom Energy, CoreWeave, and Bitcoin miners were accumulated. The view: semiconductor valuations had priced in AI demand by early 2025, while the market had not yet recognized the infrastructure scarcity that would emerge as the true bottleneck.
1.1 The Bitcoin Mining “Shortcut”
Bitcoin miners possess two assets AI data centers desperately need: secured land with proper zoning and existing power interconnection agreements that took years to obtain. Acquiring a miner is like taking over a bar that already has a liquor license — a shortcut through regulatory timelines that hyperscalers cannot replicate. Aschenbrenner has taken activist stakes in several miners with the explicit goal of converting facilities from crypto to AI hosting. Mining companies could derive 70% of revenue from AI/HPC by end-2026, up from ~30% at start of year.
Key Insight: The scarce resource in AI is not GPUs — it is gigawatts of permitted, grid-connected power. Bitcoin miners own exactly this.
2. Situational Awareness LP: Portfolio & Strategy
2.1 Top Position: Bloom Energy
The fund’s largest holding (~16% including calls) embodies the core thesis. Bloom’s solid oxide fuel cells convert natural gas to electricity at data center sites, bypassing the congested grid entirely. The company reported $20B order backlog and 34% revenue growth in 2025, with 40% growth guided for 2026. The stock returned +1,280% over 12 months as the market recognized the power infrastructure bottleneck.
2.2 Mining Positions: The Infrastructure Shortcut
The fund holds approximately 22% of Core Scientific including calls and ~6% of IREN, believed to be activist stakes. The strategy: acquire miners with secured power, advocate for conversion to AI hosting, and capture the valuation arbitrage between “mining equipment” and “AI infrastructure” multiples. The table below details the fund’s estimated mining exposure.
3. Crypto Mining Companies: Deep Dive
3.1 Core Scientific (CORZ) — AI Pivot Leader
Core Scientific is the most advanced conversion story. The company secured a $3.3B financing package and a landmark $10.2B, 12-year hosting contract with CoreWeave. Its Pecos, Texas campus is being repurposed from 300 MW of mining to 1.5 GW (1 GW leasable for AI) — a 5x expansion. AI/HPC generated 39% of Q4 2025 revenue, highest among peers. Rated “Strong Buy” with $27 median target (~18% upside). Key risk: initial AI capacity not targeted until early 2027.
3.2 IREN Limited (IREN) — AI Infrastructure King
IREN’s $3.4B GPU cloud contract with NVIDIA (with $70/share warrant for 30M shares) combined with a $9.7B Microsoft agreement brings contracted revenue to $13B+. The company secured 5 GW of AI capacity — one of the largest single-provider deployments globally. The Childress, Texas facility targets 750 MW with liquid-cooled AI computing. IREN’s 100% renewable positioning appeals to hyperscalers facing emissions commitments. 52-week return: +715%.
3.3 Cipher Digital (CIFR) — Hyperscaler Gateways
Cipher (renamed from Cipher Mining in Feb 2026) secured $9.3B in long-term leases with AWS and Google covering a fraction of its 4+ GW pipeline. Trades at ~10x NOI from existing leases. Nine “Buy” ratings; median target $24 implies ~68% upside. Burned ~$292M in Q1 2026 with significant capex ahead. But AWS/Google partnerships validate infrastructure quality and the 4+ GW pipeline represents substantial future monetization.
4. Mining Companies (Continued) & Valuations
4.1 MARA Holdings (MARA) & Riot Platforms (RIOT)
MARA reported TTM revenue of $919M with net income of $927M, yielding an unusually low P/E of 3.63x — the market prices mining earnings as unsustainable post-halving. MARA is expanding into AI via a Texas hyperscale joint venture but remains early-stage. RIOT ($9.1B market cap) operates Corsicana, Texas — originally the world’s largest Bitcoin mine — now repurposing ~two-thirds for AI/HPC. RIOT trades at 24.4x earnings, reflecting a conservative pivot approach. Both face the challenge of funding expensive conversions while managing declining mining economics.
4.2 CleanSpark (CLSK) — Efficiency Play
CleanSpark differentiates through below-average power costs built via disciplined acquisitions of undervalued mining assets. Reported 11.6% revenue growth with 130% debt-to-equity. Its AI pivot is less advanced than peers, but efficient operations provide a solid foundation. The stock’s +48% 52-week return lags the cohort, potentially offering relative value. Consensus “Strong Buy” with $18.50 target (~30% upside). A higher-risk option that could outperform if it secures meaningful AI hosting contracts.
5. Investment Opportunities & Risk Framework
5.1 The Bull Case
Power is the new oil of the AI age. The investment case rests on several pillars: (1) hyperscalers announced $1.4T+ in computing partnerships but face 5-7 year power interconnection timelines; (2) miners already possess these scarce grid connections; (3) AI hosting economics significantly exceed Bitcoin mining returns at current hash prices; (4) revenue mix shifts from volatile crypto to stable long-term contracts should drive multiple expansion as miners are reclassified from “crypto plays” to “infrastructure utilities.”
5.2 The Key Differentiator: Power Assets
The investment framework is simple: value the power, not the mining equipment. Grid interconnection agreements, land permits, and utility contracts that took years to secure are worth far more than ASIC rigs. Core Scientific’s ~$3.3B in power infrastructure would take years and billions to replicate. IREN’s 5 GW across multiple sites represents one of the largest power portfolios available to hyperscalers. When the market fully recognizes these as AI infrastructure assets, substantial re-rating potential remains.
5.3 Risk Assessment
Bottom Line: Mining companies with secured power, hyperscaler contracts, and conversion capability are critical infrastructure assets in the AI age — not speculative crypto plays. The window is narrowing (IREN +715%, Bloom +1,280% in 12 months) but with trillions in planned hyperscaler capex yet to deploy, the runway extends several years for positioned investors.
6. Reference
1.Aschenbrenner, L. (2024). Situational Awareness: The Decade Ahead. situational-awareness.ai.
2.U.S. Securities and Exchange Commission. (2026). Situational Awareness LP Form 13F-HR (Q4 2025). SEC EDGAR Filing Database.
3.CoinShares. (2026). Bitcoin Mining Report: The Pivot to AI Infrastructure. CoinShares Research.
4.Wired. (2025, December 9). America’s Biggest Bitcoin Miners Are Pivoting to AI. Wired.
5.Business Insider. (2026, April 5). For crypto miners turned AI stars, the real test is about to come. Business Insider.
6.Fortune. (2026, March 5). Why Leopold Aschenbrenner’s AI hedge fund is betting big on power companies and Bitcoin miners. Fortune.
7.Seeking Alpha. (2026, February 25). Cipher Mining: Ignore Earnings, Focus On The AI Future. Seeking Alpha.
8.Crypto Briefing. (2026, May 8). IREN shares surge on landmark AI infrastructure deal with Nvidia. Crypto Briefing.
9.Fool.com. (2026, April 25). AI Prodigy Leopold Aschenbrenner’s Situational Awareness Fund Owns Only 24 Stocks. The Motley Fool.
10.Wu Blockchain. (2025, December 31). Top 10 Mining News of 2025: Miners Pivot to AI. Wu Blockchain Newsletter.
And more.
DISCLAIMER
Past performance does not guarantee future results.
Opinions and estimates offered constitute our judgment and are subject to change without notice, as are statements of financial market trends, which are based on current market conditions. We believe the information provided here is reliable, but do not warrant its accuracy or completeness. This material is not intended as an offer or solicitation for the purchase or sale of any cryptocurrencies. The views and strategies described may not be suitable for all investors. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, accounting, legal or tax advice. Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation.
©Linux Group, October 2024.
Unless otherwise stated, all data is as of October 7, 2024 or as of most recently available.
