Caroline Ellison, the 28-year-old CEO of doomed cryptocurrency firm Alameda Research, is facing an investigation not only over the firm’s multibillion-dollar bankruptcy, but also over rumors that she was the ex-girlfriend of disgraced FTX founder Sam Bankman-Fried.
According to CoinDesk’s bombshell report, Ellison and Bankman-Fried were part of a “cabin of roommates” in a “luxury penthouse” in the Bahamas behind the FTX and Alameda shenanigans. Alameda was one of about 130 FTX Group affiliates that filed for Chapter 11 bankruptcy last week.
The housemates are reportedly Bankman-Fried’s former college classmates at the Massachusetts Institute of Technology and former co-workers at the Jane Street quantitative trading firm.
The report says that the relationship between the group of 10 insiders was not strictly business – members of the inner circle “were romantically involved or previously paired up with each other.”
Ellison and Bankman-Fried met periodically while running the now-defunct cryptocurrency empire — whose value has plummeted from an estimated $32 billion at its peak to effectively zero.
“The whole operation was run by a group of kids in the Bahamas,” a person familiar with the matter told CoinDesk.
“They would do anything for each other,” another source said.
A native of Boston, Ellison graduated from Stanford University and worked as a trader on Jane Street before becoming involved with FTX and Alameda.
As the firm’s bankruptcy continued, social media users pointed to his old interviews, including a now-viral podcast appearance from July 2020, in which Ellison described his childhood obsession with the Harry Potter books and his affinity for LARPing, dressing up as the participants and creating fictional characters. . characters.
“I was very into Harry Potter as a kid,” Ellison said. “I started, I was 3 years old when the first book came out, my parents read it out loud to me, when the second book came out when I was 5, I refused to wait for my parents to read it, so I read it myself. .”
Ellison did not tweet Since November 9th and still has not resolved the bankruptcy.
Current and former employees of FTX and Alameda told CoinDesk that Bankman-Fried and his cronies were effectively run wild with little oversight and alarmingly high conflicts of interest among employees.
In addition to Ellison and Bankman-Fried, other “roommates” in the Bahamas included FTX co-founder and chief technology officer Gary Wang and FTX Engineering director Nishad Singh.
Employees also said they were told little about what was happening at the highest levels of cryptocurrency firms as they headed toward bankruptcy.
“Gary, Nishad and Sam manage the code, the exchange’s matching engine and funds,” one of CoinDesk’s sources said. “I’m not sure who would notice if they moved them or put in their own numbers.”
Ellison and Bankman-Fried did not respond to CoinDesk’s request for comment.
The Post has contacted FTX for comment. The Alameda Research website appears to be offline.
Alameda had deep ties to the FTX debacle — which accelerated after CoinDesk reported that the cryptocurrency hedge fund had invested heavily in FTT, a token issued by FTX.
According to Reuters, between $1 billion and $2 billion in customer funds disappeared after the collapse of FTX. Bankman-Fried allegedly “secretly transferred $10 billion in client funds” from FTX to Alameda – money that was used to fund the firm’s risky trades.
Bankman-Fried told Reuters that he “did not agree with the characterization” of the $10 billion transferred.
“We didn’t transfer in secret,” Bankman-Fried said. “We mixed up the internal labeling and misread it.”
Earlier this week, Bankman-Fried put her penthouse in the exclusive Albany resort of the Bahamas up for sale for about $40 million.
But insiders say all of FTX’s top brass have homes in the residence — it’s unclear how many properties will be listed in the coming days.
The Albany Club — the Bahamas’ most exclusive resort community, which boasts members including Tiger Woods and Justin Timberlake — is also stuck in the crosshairs.
Albany partner Jason Callender commented a few years ago that the neighborhood was designed to cater to “a new breed of global elite.”
But over the weekend, Albany Club General Manager Damien Michelmore emailed residents that fellow member Sam Bankman-Fried’s company “FTX has filed for bankruptcy” and told residents not to speak to the media.
“Out of respect for all homeowners and members, we have instructed our staff not to speak to the media, and we respectfully ask our colleagues and homeowners not to comment at this time,” Michelmore said.