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SBF Trial: Ex-Girlfriend Caroline Ellison Spills the Tea

Love was in the air but now no love is lost between SBF and Caroline Ellison. Also, the FCA has wasted no time in enforcing the UK's new crypto marketing regulations, crypto talent is moving back to tradfi, and more.

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We all love catty drama - don't deny it. Endless bouts of he-said-she-said might reduce your IQ to zero but we just can't look away. Yesterday, Sam Bankman-Fried's ex-girlfriend Caroline Ellison took the stand to testify against the crypto mogul-turned-crypto villain, offering juicy details on their relationship and billion-dollar crypto conspiracy.

Love at First Fried

Ellison first met SBF on a scenic New York autumn day in September 2016. As an intern at proprietary trading firm Jane Street, Ellison found herself working under the watchful eye of SBF. He offered her mentorship, friendship, companionship and ultimately the top position at his own hedge fund that would irreversibly change the course of her life.

Unable to resist the seductive prowess of SBF, Ellison began an intimate relationship with the crypto stallion in 2019. "We started sleeping together on and off," she said in court yesterday. One summer later, the pair began dating. One year after their courtship, Ellison became CEO of Alameda Research.

However, her white knight refused to offer Ellison equity in the hedge fund. When she broached the topic, Ellison said he was “initially receptive” but later told her “it was too complicated.”

“The whole time we were dating, he was my boss at work,” she added.

Crypto's Brangelina cyclicly broke up and got back together again before ending their relationship for good in the spring of 2022.

SBF for President

Throughout their relationship, Ellison learned more about her "very ambitious" prince charming and his extraordinary vision of becoming POTUS. "He said there was a 5% chance he might be president someday," Ellison said.

SBF, 31, would have to wait another four years to legally run for president but his sly donations to both US political parties may have accelerated his journey. At least in his mind. Ellison revealed SBF thought political investments were a good investment and believed his donations helped towards the success of Joe Biden's 2020 campaign.

"He thought it was very effective, that you could get very high returns for relatively small amounts of money," she said.

Never Trust Your Ex

Never underestimate the power of your ex. They know everything about you and are driven by a pretty justified motive to use it against you. It's a lesson SBF is slowly learning.

Potentially facing 110 years in prison for her role in the FTX fallout, Ellison submitted a guilty plea to seven charges including fraud in December 2022.

In an attempt to clear her name as much as possible, Ellison has now resorted to throwing her ex-boyfriend under the bus. Testifying yesterday, Ellison said she was at the mercy of SBF who pulled the strings as FTX collapsed.

“He directed me to commit these crimes,” she said of her ex. She repeatedly insisted that SBF was steering the ship, even calling FTT "Sam's coins."

When asked to identify SBF in the courtroom, Ellison stood for as long as 30 seconds to point at SBF, saying he was “over there wearing a suit.”

Follow the Money

Whatever the state of their relationship, how the pair dealt with customer funds is nothing short of egregious. "Alameda took several billion dollars” worth of FTX customer money for investments and to cover loans, Ellison admitted to the court.

Pushing the blame on SBF, Ellison said he created systems to steal the money and allow Alameda's negative position of $2.7 billion in 2021 and its $65 billion line of credit.

Ellison claimed she was concerned about Alameda's finances from the start. Why she failed to take action at the time was not addressed. Loveblind perhaps? “Shortly after I started, I learned the company was in worse shape than I realized,” Ellison said, stating the hedge fund had initially been funded with loans “from acquaintances.”

SBF used customer funds when he bought back FTX shares from Binance in 2021, Ellison said. He told her it was “really important,” otherwise “Binance would do things to mess with FTX.” Ellison claimed she warned SBF that Alameda didn’t have the money. SBF then took $1 billion of FTX customer funds to buy out Binance.

When customers began pulling out their funds as FTX crumbled, Ellison recounted to the court, “Pretty soon [the exchange] started running out of money.”

Dealing with your ex is never pleasant, especially when billions of dollars and hundreds of years behind bars are at stake. That said, we can't wait for the next chapter.


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