Welcome back to The Stratosphere.

Which Sam Bankman-Fried associates are next to get a knock on the door? In tonight’s issue, we look at the atmospherics surrounding Democrats, S.B.F., and his inner circle after the Southern District dropped hints of a tantalizing campaign-finance scandal. This is the inside conversation about what is next.

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Bankman-Fried, after all, was until two months ago a bona fide obsession in Democratic politics, one of the biggest donors in the country, with designs to spend as much as $1 billion in 2024. He built a personal philanthropic fiefdom that tried to whip Washington, from pressing the White House on pandemic preparedness to lobbying Capitol Hill on crypto regulation.

Now, following his indictment on murky campaign-finance violations, Democrats who once eagerly solicited money from S.B.F. are preparing for the worst. The watchword of the moment, as one Democratic operative told me, is document retention. “Everyone is worried about legal action,” this person said. “Everyone’s afraid. I think once the charges were announced, and they specifically talked about his campaign donations, that put everybody on a different level than they were when they were just watching his interviews… It turned from a spectator sport into an actual criminal proceeding.”

While some Democrats fear criminal exposure, others are concerned about the potential reputational damage from the discovery process. One source joked that he had not communicated with his friends in S.B.F.’s inner circle because he wouldn’t want to find himself in text messages that might be subpoenaed by the federal government. Democrats have also been privately messaging me about more surreal matters, like the party’s various auto-delete policies for email, or what advice Democratic superlawyer Marc Elias is giving his clients, or if the House G.O.P. majority might launch investigations into S.B.F.’s various political activities and aides. “There’s a lot of chatter among finance folks—mostly people who are talking about how the Republicans are probably going to use this against Democrats,” said one progressive fundraiser. “Everyone needs to distance themselves quickly from this guy—and the whole family.”

Paranoia is a logical response when there’s no actual information to go on. Everyone even marginally connected to S.B.F. is proffering theories about who exactly could be implicated by his various alleged crimes, and who could be in the crosshairs of the so-called Sovereign District. Rumors about imminent indictments, or about people expecting to get indicted, are filling this information vacuum. I’ve heard plenty of them, and whether or not the rumors are true is beside the point. It speaks to the unease of the moment, the sense that we are only in the opening scenes of a wide-ranging campaign-finance scandal likely to boomerang all around the world of effective altruism, crypto, and Democratic politics.

Meanwhile, Democratic congressional campaigns who received money from FTX execs are divided about what to do with the cash, multiple fundraising sources tell me. Should they donate it to charity, or sit tight in case there is a chance to make FTX creditors whole? Of course, there’s a good chance their lawyers also hear from prosecutors. Indeed, nearly everyone who has had any association with S.B.F. or his political team is likely to get a door-knock or a phone call at some point, requesting their cooperation. That is why some members of S.B.F.’s former political team, like Sean McElwee, have already lawyered up with white-collar criminal defense attorneys with experience before the S.D.N.Y. Other former aides are expected to follow suit soon. Things are about to get ugly for all of S.B.F.’s men.

For instance, the D.O.J. is only now beginning to reach out with document requests to Democratic organizations that may have information about S.B.F. and Alameda Research’s political donations. Danielle Sassoon, a S.D.N.Y. prosecutor, told the court on Tuesday that they’d present evidence from political campaigns as part of the hundreds of thousands of documents they’d share with S.B.F.’s team over the next few weeks.

Prosecutors often add and delete from their initial charges in a so-called superseding indictment, which can arrive a year or more later in complex white-collar cases. S.B.F. is scheduled to file motions by early April, followed by the government’s response and a big hearing in May. So we should know more about the facts supporting the campaign-finance allegations by this spring. (A straw-donor scheme, if one existed, could be relatively easy to prove with bank records.) One possibility floated my way is that the S.D.N.Y. wanted to bombard the waterfront with as many credible charges as possible in advance of his extradition, but may later drop the campaign-finance charge if S.B.F. seems dead to rights on other counts. This sort of poker game would not be unusual for the S.D.N.Y. as prosecutors build their case and seek weak points in the defense.

The Bankman-Fried family, of course, will have no respite over the next nine months. Multiple people who have recently been in touch with Gabe, Sam’s younger brother, tell me that he is surprisingly in good spirits, almost nonchalant, holding his head up and maintaining a sense of humor—an attempt by the more socially graceful brother, perhaps, to keep up appearances. His parents, Barbara Fried and Joe Bankman, may be at legal risk themselves, but for now they are primarily concerned with their physical safety. They have blocked off the street to their home along the Stanford campus in Palo Alto, and Sam’s lawyer on Tuesday successfully convinced the judge to not unveil the names of the people who co-signed the collateral for his $250 million bail, arguing that it would put the family at risk. Barbara and Joe “have received a steady stream of threatening correspondence, including communications expressing a desire that they suffer physical harm,” said S.B.F.’s lawyer, Mark Cohen. Sam, after all, will be in the custody of his parents until the case goes to trial on October 2—assuming there is no deal struck before then.