Serenity's annual profit of 594% is suspected to be retracted 85%, and Defiance plans to launch an ETF of the same name

According to Woofun AI, the AI supply chain investment field is undergoing a critical test of shifting from community voice to traditional financial capital. The core conflict focuses on anonymous researcher Serenity's extreme performance claims and potential pullback risks, and ETF issuer Defiance's process of trying to commercialize its research framework.

Serenity's investment philosophy is based on digging deep into the “bottlenecks” in the AI infrastructure supply chain. Its strategy is not to follow giants such as NVDA.US (NVDA.US) or AMD (AMD.US), but to reverse dismantle segments with limited production capacity, high technical barriers, and a high concentration of suppliers.

This logic, which focuses on optical communication, memory, and key components, received tremendous feedback from the market in early to mid-2026. On May 26, Serenity publicly disclosed that its year-to-date return on investment had soared to a staggering 4,502.45%.

Behind this data is its precise layout in multiple segments: AXT (AXTI.US), which is an indium phosphide (InP) substrate supplier and benefits from AI optical communication requirements; Sivers Semiconductors (SIVE), which focuses on optical communication and millimeter wave technology; and Applied Optoelectronics (AAOI.US), which provides high-speed optical transceiver modules and optical network equipment. Its exposure to the storage sector is mainly reflected through ETFs (EWY) in the Korean market, rather than directly holding individual stocks such as SanDisk or Micron. Serenity's core argument is that the expansion rate of AI data centers is no longer determined only by the number of GPUs, but by physical limits in upstream processes such as optical communication, memory, advanced packaging, and power supply. These supply chain bottlenecks give smaller component manufacturers far greater growth flexibility than large chip companies.

However, extremely high returns are often accompanied by extreme volatility, a characteristic that subsequently sparked serious performance controversy. The research account Alphatica revealed a sharp fluctuation in the net worth of its account by reviewing data from screenshots of Serenity's performance published in the past. Alphatica notes that Serenity's account experienced a sharp retracement from May 26 to November after reaching an all-time high. According to Alphatica's calculation, if the 4,502.45% return on May 26 is converted to the current data of about 594.94% (Serenity claims that the return rate has been 594.4% since 2026), the account value fell as much as 84.9% from the high point.

This data comparison directly challenges the stability of Serenity's investment strategy, showing that while pursuing highly elastic returns, it faces a huge risk of net worth retracement. Notably, Serenity himself did not completely deny the existence of volatility. In July, it publicly acknowledged that the account had withdrawn 49.4% from its high point, and stated that it could withstand higher fluctuations, while expecting the portfolio's profit turning point to fall in the second half of 2027.

Despite this, Alphatica's 84.9% retracted allegation in November, further fueling the market's doubts about the sustainability of its performance.

Despite performance disputes, Serenity's research influence is rapidly penetrating traditional financial systems. According to data compiled by Woofun AI, US ETF issuer Defiance officially submitted Form N-1A registration documents to the US Securities and Exchange Commission (SEC) on November 6 to launch an exchange-traded fund called the Defiance Serenity AI Bottleneck ETF. The fund explicitly lists Serenity Bottleneck Research, LLC as an external research provider (Research Provider) to transform Serenity's community-validated AI supply chain bottleneck investment framework into an institutional-level investment product.

This move marks the transformation of Serenity's role from a simple community opinion leader to a key research provider in traditional financial product design, where the commercial value of its investment logic has been recognized by institutional capital.

According to details disclosed in SEC documents, the investment scope of the Defiance Serenity AI Bottleneck ETF will comprehensively cover all key aspects of AI infrastructure, including AI chips and computing, memory DRAM, NAND, HBM, advanced packaging, semiconductors and test equipment, optical communications, electronic components, power and heat dissipation, and robotics and physical AI. The fund will adopt an active management strategy, and under normal circumstances, invest at least 80% of its net assets in companies that meet AI Bottleneck's definition to ensure that the portfolio is highly consistent with Serenity's research themes.

In addition, the fund also retains some flexibility, allocating up to 15% of its assets to unlisted company securities or making indirect investments through single-asset special purpose companies (SPVs) to capture more diversified supply chain opportunities. This asset allocation ratio design not only ensures centralized exposure to core bottlenecks, but also leaves room for potential private market opportunities.

However, in this cooperative structure, the division of rights and responsibilities among the various actors is extremely clear, which is also a key risk point that is easily overlooked by the market. The SEC filing clearly states that Serenity is not the ETF's ultimate investment manager. Defiance ETFs acts as the fund's investment adviser (Adviser) and is responsible for overall fund management and compliance; Serenity Bottleneck Research, LLC only acts as an external research provider and provides research reports on industry trends, technology evolution, supply chain dynamics, and individual companies; while the actual investment decisions, including stock selection, asset allocation, position size and transaction execution, are handled by Sub-Adviser.

Currently, the SEC document's name, management rate, and fund manager information about Sub-Adviser is still blank, which means that the final investment execution team has not been fully determined. This structural design means that investors are not buying a direct result of Serenity's operations, but rather a portfolio executed by a third party agency based on its research framework, and there is a potential risk of performance bias between the two.

Looking at long-term trends, Serenity's collaboration with Defiance reflects the inevitable logic of AI investment evolving from “individual stock games” to “supply chain systemic investments.” Although 84.9% of retracement disputes revealed the fragility of high-volatility strategies, institutional capital's adoption of its research framework indicates the market's long-term optimism about AI infrastructure bottlenecks. This is not only the monetization of Serenity's personal influence, but also an attempt by the traditional financial system to incorporate community wisdom into standardized investment products.

However, Sub-Adviser's absence and unresolved performance disputes remind investors to carefully assess the actual execution risks of such a “research-driven” ETF. This is a landmark event where another non-traditional source of research entered the mainstream financial market after the crypto asset ETF. The final results will depend on the degree of fit between research logic and institutional execution.