Caroline Ellison aims to avoid prison time for her part in the FTX collapse.

• The legal team representing Caroline Ellison argues that she should not be incarcerated for her part in the collapse of Sam Bankman Fried's cryptocurrency empire.
• Sam Bankman-Fried, an ex-boyfriend of Ellison, was the defendant in a prosecution brought by the Department of Justice, with Ellison serving as the star witness.
• Ellison's lawyers proposed in a court document that their client should receive a sentence of time served and supervised release due to her prompt cooperation with the authorities.

Caroline Ellison's lawyers are suggesting no prison time for her role in the collapse of FTX, which was founded by her former boss and ex-boyfriend.

In a court filing Tuesday night, the attorneys argued that Ellison should receive a sentence of time served and supervised release due to her prompt return to the US from FTX's Bahamas headquarters in 2022 and her decision to voluntarily cooperate with the US Attorney's Office and financial regulators in investigating the issues at FTX and sister hedge fund Alameda Research.

In March, Judge Lewis Kaplan, who presided over Bankman-Fried's case, sentenced the FTX founder to 25 years in prison after citing Ellison's testimony.

In December 2022, Ellison, the founder of Alameda Research, pleaded guilty to conspiracy and financial fraud charges, opting for a plea deal instead of going to trial, unlike Bankman-Fried, who was convicted of all seven criminal fraud charges against him.

The Tuesday filing recommends that Ellison receive a sentence of "time served with three years of supervised release" as a credit for her "extraordinary cooperation with the government" and "her otherwise unblemished record." Lawyers argue that the Probation Department's pre-sentence report, which includes numerous character testimonials praising Ellison's ethics and integrity, should also prevent her from being fined.

"The filing states that Caroline does not pose a risk of reoffending and does not pose a threat to public safety. As such, it would be respectful of the law to grant leniency in light of Caroline's early disclosure of her crimes, her unwavering acceptance of responsibility for them, and her extensive cooperation with the government."

John Ray, CEO of FTX, has described Ellison's cooperation as "valuable" in helping his team protect and preserve "hundreds of millions of dollars" in assets. He added that she has worked with his advisors to provide information regarding private keys to cryptocurrency wallets that contain "estate assets, DeFi positions, FTX exchange internal account information, the use of third-party exchanges for pre-petition trading, and pre-petition auditing practices."

The document, which spans 67 pages, provides a detailed account of Ellison's life, from her childhood in Boston to her tumultuous relationship with Bankman-Fried. During this period, she traveled extensively at his command, first to Hong Kong and later to the Bahamas, and worked tirelessly, often under immense pressure and while under the influence of Adderall.

Ellison's moral compass was "warped" due to Bankman-Fried's direction, which led her to help "steal billions" while living "in dread, knowing that a disastrous collapse was likely, but fearing that disentangling herself would only hasten that collapse."

The filing alleges that Bankman-Fried convinced her to remain with the company, stating her importance to its survival and expressing his love for her, all while simultaneously showing her that he deemed her unworthy of being seen with him in public at high-profile events.

An attorney for Bankman-Fried didn't immediately respond to a request for comment.

The document acknowledges that she has found solace from a new partner, who is recognized by her friends as "supportive and a positive, grounding influence," but whose name is not mentioned in the document. Additionally, she has written a novel that is "unrelated to the facts of this case."

In November, Ellison will turn 30 and have a sentencing hearing on September 24, the same day she testified in Bankman-Fried's trial in the same courthouse. Her former roommates and ex-FTX executives, Nishad Singh and Gary Wang, will also be sentenced in October and November, respectively.

— CNBC's Dan Mangan contributed to this report.