Austin Chen, the founder of Manifund, said he secretly hired Caroline Ellison, the former Alameda Research CEO who served prison time for her role in the FTX fraud case.
Chen wrote on Substack that Ellison will develop Manifund's platform and research how to effectively direct philanthropic dollars. He framed the decision as a second chance. 'I believe in redemption,' he wrote.
Ellison previously led Alameda Research, FTX's affiliated crypto trading firm. In December 2022, she pleaded guilty to seven counts of fraud and conspiracy in connection with her role in the misuse of FTX customer funds to cover Alameda's debts and trading losses. She testified against FTX founder Sam Bankman-Fried and was sentenced to two years in prison. She was released from federal custody in January.
Chen said he invited Ellison to Manifest 2026, a festival the nonprofit held in June. He said she started a 'work trial' on July 13 and converted to full-time on August 10. During that period, he said, she published her work for Manifund under the pseudonym 'Carol.' Chen also apologized for the 'minor deception' of using a pseudonym, saying he did not take transparency lightly.
Ellison said she was 'deeply sorry' and grateful to Chen for giving her a second chance and judging her on her current work performance rather than her past.
The reaction split sharply. One commenter praised forgiveness and understanding, while another said the hiring showed 'truly terrible judgment' and could damage Manifund's reputation. A person who said they lost money in the FTX debacle called for her earnings to be garnished and sent to victims.
For founders, this is the hard part of redemption stories: reputation is not a soft asset, and trust compounds in both directions. Chen is betting that talent and rehabilitation outweigh the damage done. Critics will see a nonprofit taking on fresh risk with the memory of customer losses still raw.
