Caroline Ellison, the former co-CEO of Alameda Research, is scheduled to be released this Wednesday after spending 440 days in federal custody, marking another milestone in the fallout from the historic collapse of FTX.
Release From Federal Custody
According to the Federal Bureau of Prisons, the 31-year-old Ellison is set to leave a residential reentry management facility in New York, commonly known as a halfway house. These facilities are designed to help inmates transition back into society by assisting with employment placement, financial management, and reintegration services.
Ellison has been in community confinement since October 2025, after being transferred from a federal prison in Connecticut. She originally began serving her two-year sentence in November 2024, following one of the most closely watched criminal prosecutions in crypto history.
Central Figure in the FTX Collapse
Ellison ran Alameda Research, the crypto trading firm that prosecutors later revealed had deep and undisclosed financial entanglements with FTX. She also had a personal relationship with Sam Bankman-Fried, the former CEO of FTX who founded both companies.
FTX imploded in November 2022, filing for bankruptcy after a sudden liquidity crisis exposed widespread misuse of customer funds and alleged fraud. The collapse erased billions of dollars in customer assets and sent shockwaves through the global crypto market.
Guilty Plea and Sweeping Charges
In December 2022, Ellison pleaded guilty to a sweeping list of charges, including two counts of conspiracy to commit wire fraud, two counts of wire fraud, conspiracy to commit commodities fraud, conspiracy to commit securities fraud, and conspiracy to commit money laundering.
Prosecutors described her cooperation as critical to unraveling how FTX and Alameda operated behind the scenes. Ellison admitted that Alameda enjoyed special privileges unavailable to other market participants, undermining the integrity of the exchange.
Key Witness Against Bankman-Fried
Ellison became a star witness for the government during Bankman-Fried’s criminal trial in 2023. In emotional testimony, she told the court that Bankman-Fried directed her to commit the crimes that ultimately destroyed the exchange.
She revealed that Alameda had access to an unlimited line of credit on FTX, as well as direct access to customer deposits, including funds sent to a bank account labeled “fiat@.” Her testimony helped prosecutors establish intent and control at the highest levels of the FTX empire.
Disparate Outcomes for FTX Executives
While Ellison received a reduced sentence due to her cooperation, Bankman-Fried was sentenced to nearly 25 years in prison in March and ordered to repay up to $11 billion to investors and lenders. In recent months, he has reportedly been seeking a presidential pardon, though no indication has been given that such relief is forthcoming.
Other former FTX executives, including Gary Wang, the exchange’s former CTO, and Nishad Singh, a former co-lead engineer, were also criminally charged. Both cooperated with authorities and received no prison time.
Regulatory Consequences Continue
Despite their cooperation, regulatory consequences are still unfolding. Last month, the U.S. Securities and Exchange Commission (SEC) said it is seeking to bar Ellison, Wang, and Singh from serving as officers or directors of any public company for several years.
As Ellison prepares to reenter society, her release underscores the uneven outcomes faced by key figures in the FTX saga-while also serving as a reminder that legal, financial, and reputational fallout from crypto’s biggest collapse is far from over.
