The former executive of the collapsed cryptocurrency exchange FTX, Caroline Ellison, is set to be sentenced on Tuesday for her role in the sensational fraud case.

What Happened: Prosecutors have requested a lighter sentence for Ellison, highlighting her “extraordinary cooperation” in the investigation, according to a report by AP News on Monday. Her legal team has also sought leniency, citing her testimony and the emotional distress caused by her on-and-off romantic relationship with disgraced founder Sam Bankman-Fried (SBF). However, they stressed that Ellison is not avoiding accountability for her actions.

Ellison, who confessed her guilt nearly two years ago, provided crucial testimony against SBF in a trial last November. Her evidence played a significant role in SBF’s conviction for fraud, resulting in his 25-year prison sentence.

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Ellison held the CEO position at Alameda Research, a cryptocurrency hedge fund controlled by Bankman-Fried that processed some customer funds from FTX. Her professional relationship with Bankman-Fried was further complicated by a romantic involvement, which her lawyers characterized as “erratic and manipulative.”

Why It Matters: FTX, once a leading player in the cryptocurrency exchange market, collapsed in 2022 following accusations of misappropriation of customer accounts, illegal political donations, and luxury Caribbean real estate purchases by SBF and his accomplices.

The collapse precipitated the cryptocurrency winter, causing Bitcoin (CRYPTO: BTC), the market’s leading cryptocurrency, to plunge to lows of $16,000.

Ellison’s testimony against Bankman-Fried implicated him in directing fraudulent activities.

According to a popular prediction market, Polymarket, bettors leaned toward the possibility of Ellison avoiding prison time, with 47% odds in favor of such an outcome. On the other hand, bets in favor of a 1–11 month sentencing reached 23% as of this writing.

Apart from SBF’s 25-year prison sentence, Ryan Salame, another prominent figure involved in the operations of the now-defunct platform, was awarded 90 months in prison.

Photo by Sergei Elagin on Shutterstock

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.