FTX Insider Caroline Ellison Moves from Federal Prison to Community Confinement

TLDR

• Caroline Ellison, once CEO of Alameda Research, moved from federal prison to community confinement after 11 months.
• Ellison pleaded guilty to conspiracy charges for her involvement in the $11 billion FTX fraud scheme with Sam Bankman-Fried.
• Ellison was a star witness in Bankman-Fried’s trial, revealing how the duo misused FTX funds through Alameda Research.
• Ellison’s projected release date is now February 2026, nine months earlier than her original sentence of two years.
• Sam Bankman-Fried, sentenced to 25 years, is appealing his conviction and seeking a new trial due to claims of unfair legal conduct.

Caroline Ellison, the former CEO of Alameda Research and ex-girlfriend of Sam Bankman-Fried, has been transferred from federal prison to community confinement. Ellison, who had served approximately 11 months of her two-year sentence, was moved from the Danbury Federal Correctional Institution in Connecticut on October 16. The transfer means she is now in home confinement or a halfway house, according to a spokesperson for the Federal Bureau of Prisons (BOP).

Ellison’s Sentence and Role in the FTX Scandal

Caroline Ellison, 31, had pleaded guilty to conspiracy charges related to the massive fraud that led to the collapse of FTX. She was sentenced in 2024 for her role in the $11 billion fraud scheme with Sam Bankman-Fried. At her sentencing, U.S. District Judge Lewis Kaplan praised her cooperation but emphasized the seriousness of her actions, stating that prison time was necessary.

Ellison was a key witness in Bankman-Fried’s criminal trial. She testified that the two used Alameda Research to siphon funds from FTX customers. Despite the nature of her cooperation, Ellison received a two-year prison sentence, which was seen as a significant consequence of her actions in the collapse of one of the largest cryptocurrency exchanges.

Community Confinement and Early Release

Ellison’s move to community confinement means she remains under federal custody but is now subject to less restrictive conditions. The BOP confirmed her transfer but declined to disclose her exact location for privacy and security reasons. According to prison records, Ellison’s projected release date is now February 2026, which is nearly nine months earlier than her original sentence.

Her attorneys have not commented on the move, and the BOP also refrained from offering additional details. The transfer is part of a routine adjustment to sentencing based on factors like behaviour and eligibility for community confinement. While Ellison’s sentence was reduced by several months, the BOP has not specified any particular reasons for the change in her confinement status.

FTX’s Remaining Legal Battles

Sam Bankman-Fried, the founder of FTX, remains in prison after being sentenced to 25 years. He was convicted of seven counts, including fraud and conspiracy, after the collapse of FTX. Bankman-Fried is currently appealing his conviction, with his legal team requesting a new trial on the grounds of prosecutorial misconduct.

Ellison’s transfer marks a shift in her legal status, as she moves from prison to a less restrictive form of confinement. Her involvement in the FTX scandal continues to be a point of focus as the legal ramifications of the case unfold.