The Boston Blockchain Podcast EP 1 | Nic Carter And Matt Walsh On Starting Castle Island Ventures

[Music] cubic Labs presents Boston blockchain week stepping into the future celebrating the creators innovators and heroes of blockchain and web 3. I'm Mike Joshua from Mudhouse media reporting from Boston blockchain week 2022 presented by cubic Labs with me now are Nick Carter and Matt Walsh Partners at Castle Island Ventures Nick and Matt thanks for joining us thanks for having us good to be here absolutely so uh how about give us a little background that led you uh to Castle Island so Nick and I were at Fidelity before this so I had joined Fidelity in 2014 started working on a number of fidelities blockchain initiatives we started a fund under Fidelity's umbrella initially and Nick and I were working on that together and we left to go independent in 2018 to start our own fund investing in blockchain infrastructure companies so that's that's how we got here yeah that's the story I I joined Fidelity much later in 2017 and then uh as Matt says we left and Sawyer Cass Island decided we wanted to be fully independent have our own franchise and now we're three months later so when you're at Fidelity what did you what did you see that made you think hey we should we should be doing this on our own Fidelity was just an unbelievable place to work we really loved working there back in 2014 the leadership at Fidelity was going through this multi-year planning exercise and looking at disruptive technologies that could change what Fidelity looked like 10 years in the future and on that list was Bitcoin this was before ethereum had launched and the leadership was just very forward thinking you know it wasn't clear that Bitcoin was this digital gold speculative bet on the emergence of a non-sovereign currency it was just an interesting technology back then that allowed for a peer-to-peer transfer of value and so Abby and the senior team decided that that merited some time and attention just understand how it worked and so we got to work on some of those projects and that evolved over time and I'd say our view on the industry started to evolve pretty significantly after ethereum and other blockchains started to come out with more use cases for the technology and so we really just started to see that there were some of the smartest people in the entire world starting businesses in this space and saw that this was going to be the way of the next wave of the internet really and so we start to get really excited about it yeah I mean Matt's being modest Matt really pushed the agenda over there in terms of getting into crypto I joined Fidelity because they were so pro-crypto you know I when I graduated my Master's I realized or decided I had to go work in the crypto space but at that time there weren't many financial institutions that were actually genuinely Progressive on this topic and Fidelity was by far the most Forward Thinking on the topic of crypto back in 2017. so let's talk a little bit about the importance of Boston blockchain week why it's so vital to have events like this especially in person the thing is education and so if you look at this space it's evolving so fast it's almost impossible to keep up with it even if you're full-time investing in the space you almost have to pick a swim Lane in terms of the types of businesses that you're interested in types of things you'll do but these events are great because it exposes a lot of the builders exposes the people that are building things on top of public blockchains these are not just Financial use cases of the technology there's a plethora of other types of things that we're starting to see being built on top of public trans and so to me that's the most exciting part is just meeting people in the flesh understanding what they're building talking about ideas talking about the regulatory landscape and really just pushing this industry forward that way yeah this industry is so distributed and ethereal and it's rare to meet in person I think that's why the crypto industry has such an emphasis on physical conferences and they come in waves so you know for a long time during covet there was nothing and then this year there's been a lot it's important to meet you know your colleagues in the industry in person and then also I think to demonstrate to regulators and policy makers that this is a real space and with real entrepreneurs and real Capital being put to work we're constantly sort of engaged in this cold war against policy makers as they seek to regulate the industry or marginalize it in a certain way and so I think this is also a demonstration of intent the other thing I'd say is that Boston has a real leadership potential here if you look at what's going on and so a lot of this innovation has been happening at places like MIT through the digital currency initiative some of the foremost open source developers in the entire world live here and are employed by MIT or affiliate identities you have stalwart companies in the industry like Circle you have Fidelity here you have States read building out custody Flipside crypto coin metrics the startup scene is very very vibrant and it's it's exciting to start to meet people back in person again and to get some of these ideas exposed literal number one U.S based stable coin issuer in the world is based here the most active asset manager you know traditional asset manager in crypto is here in Boston so Boston has a real role to play in the industry let's talk a bit about maybe some Business Leaders that are still hesitant to jump in with blockchain just what what would you say to them or how would you get them involved to take a take another look you know look this is happening whether or not you want to be out there publicly supportive of this or not ultimately there are a lot of use cases for the technology so for something like Bitcoin or ethereum what's really driving that forward at least in the financial services space is that people want exposure to this people want to participate in this and so you're seeing firms like Fidelity and State Street and Bank of New York Mellon get active I'd imagine it's going to be really hard if you're a bank when all of your competitors are offering these things to not be offering them and to have some of the smartest people in the world going to work for your competitors building out Solutions so I think that will pull a lot of people in the other thing that will pull a lot of people in is just all of the different use cases for blockchain so who could have predicted nfts five years ago and now you're having Nike and Adidas all launch these digital twin physical nft things and so there's no shortage of entrepreneurial action here in the surface area for things that are possible to build is unlimited really and so everyone will be in it in the same way that in 1993 1994 maybe you weren't you didn't have an internet strategy but everyone ended up being on the internet right it was pervasive this is just the evolution of Internet protocols when you think of it yeah I mean just if you work in the financial services space literally just listen to your clients and end users and listen to what they want and the institutions that we find that are the most Forward Thinking are the ones that just spend time listening to to their you know client requests that is very much the case for Fidelity that was the number one request made was you know supporting crypto and so it's sometimes just a matter of literally listening to what the Market's telling you this is kind of a loaded question but what's the future of blockchain right now well I think there's sort of three big thesis areas that are driving this space one is the the monetary use cases for blockchains you're seeing an explosion of interest in non-sovereign value stores you're seeing an explosion in things like stable coins just moving Fiat currencies I think the second area that we see a ton of entrepreneurial activity is just financial services and all the new types of things that you can build in a decentralized financial services stack and then the third thing I guess people call it web 3 but it's really just using a blockchain for non-financial use cases and community on software and things like nfts and so it's really that's a huge category as well and so you know predicting that is hard we don't know what's going to emerge as breakout consumer use case in those three categories but let's say if you just measure this by the entrepreneurial talent that is trying to build things in those categories there's a lot of reason for optimism yeah I would uh I'll be I guess a little more specific I mean I think stable coins and you know crypto large cop crypto assets like Bitcoin ethereum plus the financial infrastructure that's built around them will challenge Sovereign currencies especially in Emerging Markets as you have currency crises in these places and it'll Force central banks to be more prudent in the way they manage their currencies on the nft side I think we're going to start to think of these things as persistent digital property and it won't just be about pictures of apes or punks or anything like that it'll be you know effectively your digital property right and that will manifest in a number of different ways I think you're going to see decentralized social networks and general internet communications infrastructure whereby end users have much more ownership over their identity on these platforms and it vastly disempowers these highly centralized internet companies that do the bidding of governments worldwide in terms of censorship and things like that and then on the D5 side I think we're going to see more permissioning D5 has the capacity to be brought into compliance with what Regulators might want and then lastly I think as far as the somewhat unregulated token liquid crypto space you will see a disclosure regime emerge in the US and so issuers will just have to make standard disclosures and then it'll basically be um you know a ticket into compliance in terms of the Securities laws of this country so excitement in the future obviously so many things happening definitely uh Nick Carter and Matt Walsh what's what's happening with the Castle Island Ventures right now anything coming up that you're really excited about well we're always busy you know we're always looking to speak to interesting and exciting startups deploying capital in the early stage space primarily um and you know we talk about the stuff every week so on the brink is our on the brink with Castle Island is our podcast so we're speaking to entrepreneurs every week and on that podcast and we're talking about the week's top stories yeah um if you're a pre-seed seed or a series a startup in the crypto space come and talk to us our website is castleisland.vc that's castlelin.

victor Charlie all right Nick and Matt thank you so much thanks for having us thank you for more on Boston blockchain week go to bostonblockchainweek.com for more about cubic Labs go to cubiclabs.com