Caroline Ellison, the former co-CEO of Alameda Research and a central figure in the collapse of cryptocurrency exchange FTX, is expected to be released from federal custody on Wednesday after serving roughly 440 days of a two-year prison sentence, according to data from the U.S. Federal Bureau of Prisons. 

Ellison, 31, is expected to exit from a residential reentry management facility — commonly known as a halfway house — in New York, where she has been held in community confinement since late 2025. 

Her early release came approximately ten months ahead of her original projected term and reflects credit for cooperation with prosecutors and good conduct while incarcerated.

Ellison was sentenced in September 2024 to two years in prison after pleading guilty in December 2022 to multiple fraud and conspiracy charges tied to the misuse of customer funds at FTX and the trading firm Alameda Research. 

She began serving her sentence in November 2024 at a federal facility in Connecticut before being transferred to community confinement.

Ellison’s role in FTX

As part of her plea agreement, Ellison cooperated extensively with federal authorities and testified against former FTX CEO Sam Bankman-Fried during his criminal trial in 2023.

Her testimony detailed how Alameda and FTX commingled customer assets, concealed financial losses, and relied on an effectively unlimited line of credit that allowed Alameda to draw directly from FTX customer deposits.

That evidence played a key role in Bankman-Fried’s conviction on multiple fraud charges. He was sentenced in March 2025 to nearly 25 years in prison and ordered to forfeit up to $11 billion in assets to compensate investors and lenders.

Federal regulators have barred Ellison from serving as an officer or director of a public company or cryptocurrency exchange for ten years. 

The Securities and Exchange Commission has also sought similar prohibitions against other former FTX executives who cooperated with authorities, including former CTO Gary Wang and ex-engineering head Nishad Singh, both of whom avoided prison time.

FTX collapsed in November 2022 after a liquidity crisis exposed a multibillion-dollar hole in its balance sheet, triggering one of the largest bankruptcies in the history of the crypto industry.

Bankman-Fried and Caroline Ellison reportedly had an on-again, off-again romantic and professional relationship, living together with other FTX executives in a Bahamian penthouse while working closely at Alameda Research.