Caroline Ellison

• 1. The Video Call

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  On the 9th of November 2022, Caroline Ellison, chief executive of the trading firm Alameda Research, joined a video meeting with her employees. According to anonymous sources cited by The Wall Street Journal and The New York Times, she told them that FTX had used customer money to help Alameda meet its liabilities. She also said that she, Sam Bankman-Fried, and two other FTX executives, Nishad Singh and Gary Wang, knew about it. The scandal that followed became one of the biggest in the history of the United States.

  Before that day, Ellison had been a prize-winning math student, a quantitative trader, and a name on a list of promising young financiers. How does someone with that record end up in the middle of such a collapse? What did she admit in court, and what did it cost her? The answers begin in a Boston household full of economists.

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• 2. A Mathematical Childhood

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  Caroline Ellison was born in Boston and grew up in the nearby suburbs of Cambridge and Newton. She is the eldest of three daughters of Glenn and Sara Fisher Ellison, both economists at MIT. The family was Catholic, and economics was part of daily life. Ellison says she and her siblings learned Bayesian statistics in primary school.

  At the age of 8, Ellison gave her father a birthday present: an economic study of stuffed animal prices at Toys "R" Us. At Bigelow Middle School, she and her younger sister Anna competed on the math team, which their father coached. In 2008, Ellison received top honors in the American Mathematics Competitions.

  In 2011, as a student at Newton North High School, Ellison represented the United States at the International Linguistics Olympiad. She came home with an honorable mention and an award for "best solution". She captained her school's team in the Greater Boston Math League and represented Newton several times in the Math Prize for Girls. During her senior year, she was accepted into the MIT PRIMES after-school program.

  She graduated in 2012 with a National Merit Scholarship. Her next stop was Stanford, where numbers met a new kind of idealism.

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• 3. Stanford and Jane Street

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  Ellison graduated from Stanford University in 2016 with a bachelor's degree in mathematics. In the Putnam Competitions of 2013, 2014, and 2015, she scored among the top 500 students. As a freshman she developed an interest in effective altruism, a data-based philanthropic movement. She joined Stanford's effective altruism club and became its vice president.

  Her trading career began while she was still a student, with two internships at Jane Street, a proprietary trading firm in New York City. In September 2016, she joined Jane Street full-time as an equities trader. Her cohort was mentored by Sam Bankman-Fried.

  Bankman-Fried left the firm a year later to become director of development at the Centre for Effective Altruism in Berkeley, California. The two had bonded over effective altruism, and they stayed in touch after he left.

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• 4. Joining Alameda Research

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  In February 2018, while visiting the San Francisco Bay Area, Ellison met Sam Bankman-Fried for coffee. He pitched her on Alameda Research, a cryptocurrency hedge fund he had co-founded in November 2017 with effective altruism colleague Tara Mac Aulay. Ellison joined the following month.

  She described the move as a "blind leap". She said it was driven by excitement about arbitraging cryptocurrencies and by the chance to pursue earning to give. When she arrived, she had more experience than most of the other traders.

  In October 2021, Ellison became co-CEO alongside Sam Trabucco. In August 2022, Trabucco stepped down and she became the sole CEO. Her title outran her ownership, however. She received no equity in Alameda Research and held only a 0.5% stake in FTX.

  Just a few months separated her sole leadership of Alameda from the moment reporters began questioning its books.

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• 5. Unraveling

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  In November 2022, Forbes named Ellison and Sam Trabucco to its 30 Under 30 list. A year later, the magazine regretted the pick and placed Ellison on its Hall of Shame, a list of ten selections it wished it could take back.

  On the 6th of November 2022, CoinDesk raised concerns about the balance sheet of Alameda Research and its relationship with FTX. Ellison answered that the released figures covered only some of Alameda's assets. She said the firm held more than $10 billion of additional assets.

  An anonymous source cited by The Wall Street Journal in November 2022 told a different story. The source said Alameda owed $10 billion to FTX. According to that account, FTX had lent the trading firm money from customer funds.

  Then came the bankruptcy filings. FTX, Alameda Research, and more than 100 related companies filed for Chapter 11 protection. John J. Ray III terminated Ellison from her position.

  Her next appearance would be in a federal court in the Southern District of New York.

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• 6. The Guilty Plea

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  In December 2022, Ellison hired Stephanie Avakian of the law firm WilmerHale as her lead attorney. On the 18th of December, she pleaded guilty in the Southern District of New York to six charges. Two were conspiracy to commit wire fraud, one aimed at FTX customers and one at Alameda's lenders. A third was wire fraud against those lenders. The remaining three were conspiracy to commit commodities fraud, securities fraud, and money laundering.

  Gary Wang, an FTX co-founder, also pleaded guilty to several charges that same day.

  A transcript of her plea hearing was unsealed on the 23rd of December. In it, Ellison told judge Ronnie Abrams that she and others had conspired to steal billions of dollars from FTX customers. She said they had also misled investors and lenders. She told the judge that Sam Bankman-Fried and other FTX executives had received billions of dollars in secret loans from Alameda Research. Her plea deal required her to make restitution in an amount the courts would decide.

  In October 2023, Ellison testified for the prosecution at Bankman-Fried's fraud trial. A judge would later weigh that testimony when deciding her own punishment.

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• 7. Sentence and Release

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  On the 24th of September 2024, U.S. District Judge Lewis Kaplan sentenced Ellison to two years in prison. He also ordered her to forfeit $11 billion to the court. Kaplan called her cooperation against Bankman-Fried "very, very substantial". He said prison time was still necessary because of the magnitude of the crime.

  Ellison began serving her sentence at a prison in Connecticut in early November 2024. In December 2024, The Washington Post reported that the sentence had been reduced by several months. After 14 months in federal custody, she was released on the 22nd of January 2026.

  Part of her story sits outside the courtroom: the home she shared with colleagues when FTX collapsed.

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• 8. Penthouse and Foundation

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  When FTX collapsed, Ellison, Sam Bankman-Fried, and several friends and coworkers were still living together in a penthouse apartment. Unspecified former employees gave accounts of a romantic relationship between Ellison and Bankman-Fried. Business Insider said CoinDesk had singled out the alleged relationship. Bankman-Fried told Good Morning America that the relationship was brief.

  Ellison also joined senior FTX employees in contributing to the FTX Foundation's Future Fund. The fund planned to support philanthropic work. It stopped operating when its own senior staff resigned. They cited an inability to honor grants and concerns about the legitimacy of its funding.

  That left some of its beneficiaries unsure whether they would have to return grant money.

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