2 years, 225 times the return? Unveiling the mysterious researcher Serenity's AI "bottleneck" investment technique

Author: BruceBlue, former Bing Ventures GP

How did the mysterious researcher Serenity earn over 225% returns in 2 years?

Using Checkpoint Theory to identify irreplaceable physical switches in the AI era.

Using Bottom-Up supply chain reverse engineering thinking to find choke points.

Before making any investment assumptions, he engages in intense debates with various AI models to identify potential flaws and limitations, akin to a top-tier investment IC.

Introduction

In the past few months, if you have been following the secondary market for AI infrastructure, it has been hard to avoid one name: Serenity @aleabitoreddit

A former trader permanently banned from Reddit WallStreetBets (WSB), he switched platforms and adopted an anime female avatar, gathering over 300,000 followers in less than a year. One of his tweets can cause FTSE 250 constituents to soar nearly 90% in two days, his research has been cited by Bloomberg and Reuters, and even hedge funds are doing copytrades based on his insights.

The market is amazed by his staggering 22,561.99% return over the past two years, or questioning his unverifiable background: "former AI research scientist," "Nature paper author," "RISC-V Foundation member," and even claiming he turned down an offer to lead NVIDIA's AI team when its stock was only around $6 in 2018.

Serenity's AI Holdings List

But what truly matters is not his dazzling numbers, nor whether he has actually published in Nature.

What truly matters is: he provides a paradigm for reverse engineering the AI era and has completed violent information arbitrage in Wall Street's institutional blind spots.

The core of this paradigm, he calls Chokepoint Theory.

From WSB Gambler to Supply Chain Detective: A Transformation of Identity

Let’s provide some background. His story began in early 2022 on the famous retail investor forum r/wallstreetbets (WSB).

At that time, his account was called AleaBito, characterized by a distinct WSB retail flavor, enthusiastic about high leverage, high risk, and highly entertaining options and IPO trading. He once executed a $175,000 one-sided options "YOLO" trade during the eToro ($ETOR) IPO due to a technical chart resembling the "Toro" meme logic. In trading Hims & Hers Health ($HIMS), he allocated $100,000 based on the "Gym Bro Formation." Additionally, he accurately predicted that Super Micro Computer ($SMCI) would break through $120 when its stock was at a low point, based on the development of liquid cooling technology.

┌────────────────────────────────────────────────────────────────────────┐

│ @aleabitoreddit / Serenity's Evolution Path

├────────────────────────────────────────────────────────────────────────┤

│ Reddit Phase (Before 2022): AleaBito

│ Style: Combining hardcore financial analysis with highly entertaining "WSB retail" narratives, favoring high-risk "YOLO"

│ Achievements: $ETOR (Toro), $HIMS (Gym Bro), $SMCI (Predicted breakout above $120 at low point)

│

│ X Platform Phase (2022 to Present): Serenity

│ Style: Focused on AI data center hardware, silicon photonics, and advanced packaging with a "Bottom-Up" supply chain reverse engineering approach

│ Achievements: $RPI, $SIVE, Soitec, $VLN, $NBIS

└────────────────────────────────────────────────────────────────────────┘

The turning point occurred in early 2022. He published an in-depth fundamental research report on the compound semiconductor substrate manufacturer AXT Inc. ($AXTI) on WSB. At that time, $AXTI had a market cap of only $200 million and a stock price of about $12. Due to the report's professionalism clashing with the speculative atmosphere of the forum, the moderators permanently banned the account on the grounds of "deliberately guiding public opinion" and "pumping and dumping."

Subsequently, $AXTI soared to $70 driven by a surge in demand for compound semiconductors and optoelectronic substrates, achieving over 1000% unrealized gains, marking a "name-making battle" in the researcher's investment career. This banning incident directly led to his migration to the X platform, and after renaming himself "Serenity," he completely focused his investment on the "choke points" of core semiconductor hardware and precision supply chains.

Core Framework: Finding the "Strait of Hormuz" in the AI Era

The vast majority of Wall Street's sell-side institutions view AI from a top-down perspective. They focus on Nvidia, Microsoft, Google, calculating trillion-dollar Capex guidance and engaging in intense mathematical modeling games around next quarter's revenue.

Serenity's perspective is bottom-up. He employs a supply chain reverse engineering model.

He takes Nvidia's H100, B200, and other GPU supercomputing clusters as physical reference points, deconstructing layer by layer until he uncovers ultra-micro components or raw materials that cannot be replaced or monopolized by a single or very few companies on a physical level. These extremely niche areas operate quietly outside the spotlight of trillion-dollar market caps, yet if a supply disruption occurs, the entire downstream AI industry cluster will face physical paralysis.

He refers to these nodes as "choke points" and likens them to the Strait of Hormuz controlling global oil channels, or the perilla leaves that are essential yet unnoticed in high-end kaiseki cuisine in Ginza.

• Integration of Physical and Geographical Coordinate Maps

Serenity has constructed a precise global semiconductor "choke point" physical and geopolitical map. This map spans US stocks, Taiwanese stocks, European stocks, and Japanese stocks, integrating the geographical coordinates of every segmented giant in the supply chain, technological patent barriers, geopolitical risks, and export control policies of various countries in a multi-dimensional manner. When new geopolitical conflicts, export bans, or earnings disclosures occur, he can quickly locate specific physical nodes on the supply chain map and use his highly concentrated stock positions to make highly certain directional bets.

• Adversarial AI Argument Testing

Before formally releasing any investment assumptions, Serenity has a unique "red-blue adversarial" argument process. He inputs research drafts into different large language models, commanding the AI to act as an extremely critical "Devil's Advocate," specifically identifying flaws in his investment logic, technical physical limitations, threats from alternative solutions, and potential valuation biases. Only after passing multiple rounds of technical and logical questioning by the AI does he publicly release the report.

Physical Barriers of Silicon Photonics and Co-Packaged Optics (CPO)

In Serenity's supply chain map, the physical evolution of data center AI computing infrastructure is its core investment line.

With the exponential growth of large language model parameters, the interconnection of GPU clusters with tens of thousands, hundreds of thousands, or even millions of cards has become a physical bottleneck for computing expansion. Under extremely high data throughput, traditional copper cable interconnections face insurmountable physical limits: high-frequency electrical signals experience significant attenuation, uncontrollable electromagnetic interference, and high power consumption and heat dissipation burdens.

To break through this "copper wall," the process of converting electrical signals to optical signals for high bandwidth, low latency transmission has become a necessary path for AI infrastructure construction. The forefront of this physical layer transformation is the "Co-Packaged Optics" (CPO) architecture, led by giants like TSMC and Nvidia.

The core idea of CPO is to directly integrate optoelectronic conversion chips with core computing chips on the same multi-chip packaging substrate, shortening the transmission distance of electrical signals within the package to the millimeter level. This revolutionary architecture has five major "choke point" technical physical barriers that Serenity has focused on:

Serenity's CPO (Co-Packaged Optics) Reverse Engineering Map:

Nvidia H100/B200 Clusters (Demand for tens of thousands of interconnections)

│

▼

Optical-to-Electrical Transition (Breaking the physical limits of copper cables: attenuation, power consumption, heat dissipation)

│

▼

┌────────────────────────────────────────────────────────────────────────┐

│ Five Physical Barriers of Silicon Photonics and CPO (Choke Points)

│

│ 1. High-Precision Physical Alignment: Fiber Array Units (FAU) and Microlenses

│ → $FOCI (FocalTech, Taiwan): Indispensable physical choke point position

│

│ 2. External Light Sources (ELS) and High-Power Continuous Wave (CW) DFB Lasers

│ → $SIVE (Sivers, Sweden): Extremely scarce physical asset for 1.6T LRO/CPO

│

│ 3. Molecular Beam Epitaxy (MBE) Equipment Barriers

│ → $ALRIB (Riber, France): Global monopolist, choking the "capacity neck" of epitaxy manufacturers

│

│ 4. High-Purity Red Phosphorus Raw Materials (Purity must reach 6N-7N, i.e., above 99.9999%)

│ → NCI (Nippon Chemical Industrial, Japan): Monopolized by a very few specialty chemical giants

│

│ 5. Substrate Materials: Silicon on Insulator (SOI) Substrate

│ → Soitec (France): Absolute global monopolist in technology and capacity with Smart-Cut patent

└────────────────────────────────────────────────────────────────────────┘

• High-Precision Physical Alignment Barrier

Due to the sub-micron size of the waveguides inside silicon photonic chips, it is required that the fiber introduced from the outside must achieve nanometer-level physical alignment with the waveguides. Any slight displacement can lead to severe "optical coupling loss." Serenity was the first to systematically anchor the highly focused attention of Taiwanese retail investors on FocalTech (FOCI, 3363.TW) with the global evolution of CPO technology.

• External Light Sources (ELS) and High-Power Continuous Wave DFB Laser Barriers

Silicon, as an indirect bandgap semiconductor, cannot achieve efficient light emission under electrical injection. The CPO architecture must rely on independent external light sources to provide high-power continuous wave lasers. These lasers must maintain single longitudinal mode operation in high-temperature and high-pressure data center environments, with extremely high process requirements. Sivers Semiconductors ($SIVE), listed in Stockholm, Sweden, has become an extremely scarce physical asset in the CPO external light source supply chain due to its relevant technology.

• Molecular Beam Epitaxy (MBE) Equipment Barriers

In the growth of compound semiconductor epitaxial wafers for high-power lasers, the core physical process is Molecular Beam Epitaxy (MBE), which allows for the growth of ultra-thin crystal films with atomic-level precision. Serenity has locked in the absolute monopolist of global MBE equipment: the French listed company Riber ($ALRIB).

• High-Purity Red Phosphorus Raw Material Barriers

The manufacturing of compound semiconductors (such as indium phosphide substrates) requires extremely stringent raw material purity. Serenity has traced reverse engineering down to the most fundamental chemical element: high-purity red phosphorus (purity above 99.9999%). Capacity is almost entirely monopolized by a very few Japanese giants like Nippon Chemical Industrial (NCI). Once supply is disrupted, the downstream will come to a complete halt.

• Silicon on Insulator (SOI) Substrate Material Barriers

The underlying wafers of silicon photonic chips need to use SOI wafers. The French company Soitec, with its exclusively invented Smart-Cut technology, holds an absolute global monopoly in technology and capacity in the silicon photonic SOI wafer market, even requiring Japan's Shin-Etsu Chemical to pay patent licensing fees.

Geopolitical Game of "Physical Switches" in Humanoid Robots and Rare Earth Resources

In 2026, Serenity will further expand his "choke point" map to the geopolitical game of humanoid robots and rare earth resources.

• Supply Chain Rifts Between Software "Brains" and Hardware "Bodies"

Market discussions about Tesla's Optimus mostly focus on AI algorithms and large models, neglecting a fatal physical fact: the US is losing the hardware and materials manufacturing race for humanoid robots.

The "brains" of humanoid robots are retained in the US, but the "body" components responsible for movement (joints, actuators, reducers, etc.) are almost entirely in the hands of Asian manufacturers:

• Harmonic Reducers: Harmonic Drive (Japan), Green's Harmonic (China)

• RV Reducers: Nabtesco (Japan), Double Ring Drive (China)

• Linear Actuators: SMI (China)

• Servo Systems and Ball Screws: Inovance Technology (China)

To lower costs, US robotics companies have signed long-term contracts with these Japanese and Chinese component giants. This high dependency means that once geopolitical friction occurs, the hardware supply chain will face physical paralysis.

• Rare Earth "Demand Tsunami" and Morgan Stanley Model

Serenity cites Morgan Stanley's demand forecasting model for quantitative deduction: if the global stock of humanoid robots reaches 1 billion by 2050, their consumption of core rare earth resources will create a catastrophic "demand tsunami":

• Neodymium (Nd): Cumulative consumption of about 400,000 tons (15% of known global reserves)

• Dysprosium (Dy): Cumulative consumption of about 80,000 tons (25% of known global reserves)

• Terbium (Tb): Cumulative consumption of about 16,000 tons (30% of known global reserves)

These are physical necessities to maintain permanent magnet motors from demagnetizing at high temperatures. Serenity emphasizes that if Western capital wants to ensure supply chain security, it must direct billions of dollars to rebuild the domestic rare earth refining ecosystem.

Based on this, he listed three major physical sectors that must be closely monitored:

• Magnetic Metals: Light rare earths (neodymium, praseodymium), heavy rare earths (dysprosium, terbium), specialty magnets (samarium, cobalt).

• Structural Metallurgy: Precision gear materials (titanium, vanadium, molybdenum), high-strength steel additives (niobium, chromium, nickel, manganese), wear-resistant elements (cerium, lanthanum).

• Computing, Sensing, and Power Systems: Advanced semiconductors (gallium, germanium), batteries and wiring (each consuming 2kg lithium, 3kg graphite, 6.5kg copper).

Core Target Case Studies and Empirical Performance Evaluation

Through keen capture of technological barriers and commercialization inflection points, Serenity has successfully unearthed and led the value reassessment of several classic mid-to-low market cap tech stocks across different global capital markets.

┌────────────────────────────────────────────────────────────────────────┐

│ Serenity Core Investment Targets and Empirical Performance Verification

├────────────────────────────────────────────────────────────────────────┤

│ $RPI (Raspberry Pi) | LSE UK

│ Positioning: Physical base for AI intelligent swarm control

│ Starting Point: Stock price below 280 pence (IPO issue price)

│ Verification: Strong profit growth disclosed in March 2026 annual report, chip sales surged 47%, confirming its logic in AI base

│ Performance: Stock price soared nearly 40% on the day of earnings release, rebounding over 60% from the bottom

│

│ $SIVE (Sivers) | Stockholm Sweden

│ Positioning: Core supplier of high-power external light source DFB lasers for silicon photonics CPO

│ Starting Point: Market cap only $130 million when recommended

│ Verification: Strategic partnership with Jabil, received $6.6 million support from the US CHIPS Act

│ Performance: Market cap skyrocketed nearly 19 times within a year after recommendation (now over $2.3 billion)

│

│ Soitec | Euronext Paris France

│ Positioning: Absolute global monopolist in patents and capacity for silicon photonic SOI key substrate materials

│ Starting Point: Stock price at €43 bottom area

│ Verification: Listed as a class exclusive material standard by TSMC and Nvidia

│ Performance: Stock price instantly surged 16% in the European market on the day the viewpoint was published

│

│ $VLN (Valens) | NYSE USA

│ Positioning: In-vehicle A-PHY high-speed transmission chip

│ Starting Point: Market cap $253 million bottom (recommended with $93.5 million cash on hand, zero debt, about 60-62% gross margin guidance)

│ Verification: Identified mispricing due to scanner code collision errors

│ Performance: Guided the market to reassess the asset through pointing out the "code collision" bug

│

│ $NBIS (Nebius Group) | NASDAQ USA

│ Positioning: Largest AI GPU/Rubin computing cluster cloud service provider in Europe

│ Starting Point: Around $95 pullback bottom area

│ Verification: Holding $3.7 billion net cash (by end of 2025), backlog of unexecuted contracts approaching $50 billion

│ Performance: Returned to high growth trajectory, analyst target price raised to $158-$211

└────────────────────────────────────────────────────────────────────────┘

In-depth Analysis: Three Dimensions of Cognitive Arbitrage

• Raspberry Pi $RPI: Relative Value Game Model

When the market viewed Raspberry Pi as a declining educational component manufacturer, Serenity captured the dramatic changes in the AI developer ecosystem: numerous startups were buying Raspberry Pi as a physical isolation base for deploying "AI intelligent swarm control systems." If buying an Apple Mac Mini, this hoarding trend would be inconsequential in Apple's $3.7 trillion market; but for a company valued at only £500 million, this was a disruptive boost.

• Valens Semiconductor $VLN: Quantitative Code Collision Information Arbitrage

$VLN had $93.5 million net cash, zero debt, and about 60-62% gross margin guidance, locking in a pre-installed point with Mercedes, yet its market cap was only $253 million. Serenity discovered a physical bug: the mainstream quantitative stock scanning tool globally had a "trading code collision error," confusing $VLN's data with Toronto Stock Exchange energy stock $VLO, leading to severe distortion of key indicators. He precisely listed the deviations, guiding funds to "sweep mines" for reassessment.

• Nebius Group $NBIS: Deep Bottom Capture Amid Mechanical Panic

As Europe's leading AI cloud service provider, $NBIS faced algorithmic selling pressure due to early complex convertible bond hedging arbitrage, causing its stock price to plummet to $95. Serenity pointed out this was a "mechanical panic due to non-fundamental factors." At the $95 price level, the market gave this company, which had a revenue guidance of $3-3.4 billion in 2026 (nearly 6 times growth) and held billions of dollars in net cash, an extremely absurd discount.

Retail Capital Collaboration and Potential Structural Risks

• Expert Retail Collaborative Network

In Serenity's framework, retail investors are no longer merely providing liquidity or blindly following trends as "chives," but are reshaped into an "expert retail collaborative network." Traditional WSB relied on short-term options gamma squeezes or emotional memes to drive surges. In contrast, Serenity conducted a deep "intellectual filtering" of his followers through his completely free, highly technical hardcore analysis.

This highly specialized capital collaboration enables them to quickly form a collective force in extremely illiquid, remote micro-cap markets that Wall Street giants cannot cover, leading to pricing dominance over core assets.

• Institutional Blind Spots and Information Arbitrage

Analysts at large institutions are constrained by internal compliance, minimum market cap thresholds (e.g., not covering below $1 billion), and regional divisions (US stock analysts do not write research on Sweden or Taiwan). This has created a significant research vacuum in the global supply chain. Serenity, as a completely anonymous independent researcher, ignores market cap and regional barriers, directly guiding global long capital to violently fill these vacuum areas.

• Structural Risks and Potential Game Dilemmas

However, blindly following this strategy comes with unavoidable fatal risks:

• Liquidity Exhaustion and Stampede Risks (Liquidity Traps): Micro-cap stocks have extremely low average trading volumes. When retail collaboration surges, it skyrockets instantly; once the technology fails to meet expectations, the extremely narrow exit channels will lead to severe stampedes.

• Polarized Public Opinion and "Insider" Accusations: Veteran short sellers sharply criticize it as essentially a "pump and dump with a high IQ academic packaging." Its game characteristics of attracting retail investors with massive public opinion volume expose it to long-term compliance accusations.

• Fatal Minefields of Single Path Dependency in Physical Technology: All of Serenity's core positions are built on the assumptions that "CPO is the only physical evolution route" and "humanoid robots will experience a billion-unit explosion." This is a gamble. If Nvidia discovers insurmountable engineering deadlocks with CPO and shifts to advanced thin-film copper cables, or if the West fails to rebuild the rare earth separation chain, his entire supply chain empire built on silicon photonics, SOI, MBE equipment, and heavy rare earths will be instantly dismantled on a physical level.

Conclusion: Using Geeky Depth to Strike Financial Breadth

Following Serenity is not about getting a code to get rich, but about gaining an analytical framework that breaks consensus.

In this age of information overload, the most common mistake retail investors make is to compete with institutions for the speed of information acquisition or to trade macro data that has already been fully priced. Serenity demonstrates another possibility: to deconstruct the system through reverse engineering, to use AI as a "Devil's Advocate" to challenge one's own logic, and to seek out those silent gears that truly control the operation of the system.

You do not need to become the next Serenity. You do not need to buy any stock he buys.

But you should learn to ask a question like he does:

In this system, who is that silent, irreplaceable physical switch?

If you can answer this question, you already have one more perspective than 99% of market participants. The rest is just waiting for the market to catch up with your understanding.

Disclaimer:

This article does not constitute any investment advice.

All background information about Serenity is self-reported and has not been verified by third parties.

His historical performance does not represent future results.

Please conduct independent research before making any investment decisions.

NFA. DYOR.