On The Brink with Castle Island

Latest Episodes:

Bruce Fenton (Chainstone Labs) on the paradox of governance tokens (EP.139) Oct 19, 2020

Show notes

Bruce Fenton, founder of the Satoshi Roundtable and Chainstone Labs, joins the show to talk security tokens and tokens-which-are-securities. In this episode:

About Bruce's company Chainstone labs
How the Bitcoin Roundtable is intertwined with Bitcoin history and the blocksize debate
Coinbase's ongoing rapprochement with Bitcoiners
Why longevity is so difficult in the crypto industry
Are we living in the most historically aggressive period in terms of regulatory oversight into the industry?
What Bruce makes of Heath Tarbert's comments on Ethereum
Continuing uncertainty about the status of Ripple's XRP – and what possible outcomes look like
The prospects for token S1s and a genuine standard of disclosure for new issuances
Why trying to avoid securities laws causes token issuers to create subpar instruments
How much control do governance tokens really give tokenholders?
Why Bitcoin isn't sufficient to resist the state alone – and what tools are part of that toolkit
Why the US should consider disrupting itself with regards to managing the world's financial system
Why some people like security tokens for the wrong reasons
The logistical advantages of tokenizing a security
How security tokens could open up mid-size businesses which don't have access to capital markets

Weekly Roundup 10/16/20 (Does China control Bitcoin?, Filecoin launches, Heath Tarbert praises Ethereum) (EP.138) Oct 16, 2020

Show notes

Matt and Nic cover deals and news of the week. In this episode:

NYDIG emerges from stealth and announces a Bitcoin balance sheet position
More companies add Bitcoin to their balance sheet
Filecoin launches at a $200b implied fully diluted valuation
Is the Filecoin SAFT different from the other SAFTs?
Why token projects are strongly incentivized to be untransparent about their tokens
CFTC chair Heath Tarbert praises Ethereum
The relationship between securities and commodities
Ripple complains about securities regulation and claims China controls Bitcoin
Grayscale Ether Trust becomes an SEC reporting entity
Grayscale raises $1b in Q3
Breitling creates NFTs as an anti-counterfeiting measure
Risks involved with brainwallets
Coinbase plans to sponsor Bitcoin developers
A new deadline in the Mt Gox saga

Content mentioned in this episode:

Crypto VC panel on privacy from the Fidelity privacy conference
Ripple, What's at Stake for the U.S. When It Comes to Digital Asset Regulation
The Block's new data dashboard
Bitmex Research, Call me Ishmael
Ryan Castellucci talk at DevCon, Cracking Cryptocurrency Brainwallets

Kyle Samani (Multicoin Capital) on breakout applications for Web3 (EP.137) Oct 12, 2020

Show notes

Kyle Samani, cofounder and managing partner at Multicoin, joins the show to talk his current views on Bitcoin, Ethereum, and to give an update on web3 and how Multicoin is approaching the opportunity. In this episode:

Kyle's current views on Ethereum, its positioning, and its prospects for filling out the roadmap
Whether liquidity network effects for smart contract chains are insurmountable
What it would take to reach global scale for public blockchains
Kyle's changing view of Bitcoin over time
The effect of WBTC on Ethereum
The topic that Kyle has most dramatically changed his mind on recently
Kyle's view of the validity of DCF valuations for DeFi tokens
Kyle's theory on which classes of DeFi tokens should accrue long-term value
A retrospective on Multicoin's EOS thesis and where they were tripped up
Which blog post of his Kyle thinks has aged the best
What Web3 means to Kyle
How fast Web3 has grown relative to Kyle's expectations in 2017
The imminent Web3 projects that Kyle thinks could have mass market applicability
Multicoin's Helium thesis and the importance of LoRaWAN
How Helium tokenomics are modeled after physical commodities
Kyle's expectations for web3 applications within the next 5 years
Whether Ethereum requires web3 to succeed and vice versa

Content mentioned in this episode:

Weekly Roundup 10/09/20 feat. Zachary Kelman (Square buys Bitcoin, effect of fees on DeFi, FinCEN files retrospective) (EP.136) Oct 09, 2020

Show notes

Matt and Nic cover deals and news of the week. Repeat guest Zachary Kelman joins the show to give his view of the FinCEN files and how the crypto industry should interpret the revelations. In this episode:

How fees affect DeFi liquidity and the price of ETH
Braintrust raises $18m
Bitnomial raises an $11m Series B
Arthur Hayes and Sam Reed step down from their roles at 100x
Despite everything, Bitmex is still operational
BitMEX keeps processing withdrawals
India's legislature turns hostile to Bitcoin
Square buys $50m worth of BTC to hold on its balance sheet
The difference in the rationale between Microstrategy and Square for their Bitcoin positions
John MacAfee is arrested in Spain for tax evasion
Ripple complains that the US is an unfavorable regulatory environment
The latest on the Ripple class action suit
The Chamber of Digital Commerce gives congresspeople $50 worth of USA-mined Bitcoin
The DOJ publishes a Cryptocurrency Enforcement Framework
Zach Kelman on how Bitcoin enthusiasts should be thinking about the FinCEN files
Silvergate crosses $100b transacted through the SEN

Content mentioned in this episode:

Peter Van Valkenburgh, There Is No Such Thing as a Decentralized Exchange
Fidelity Digital Assets, The Role of Prime Brokerage in Digital Assets
Nic on Medium, Public blockchain fee cyclicality and negative feedback loops
Forbes, How Cathie Wood Beat Wall Street By Betting Tesla Is Worth More Than $1 Trillion

Mitchell Nicholson (DACS Conduit) on leaving central banking for Bitcoin (EP.135) Oct 07, 2020

Show notes

Mitchell Nicholson is the founder of DACS Conduit and formerly an economist at the Bank of Canada. Mitchell's views are his own and not those of the Bank of Canada. In this episode:

His path to joining the Bank of Canada
Why he chose to start his career in central banking
Mitchell's work on the Band of Canada Bitcoin awareness surveys
Why the Bank of Canada put resources to the Bitcoin awareness surveys
Mitchell's masters thesis on Bitcoin
How covering Bitcoin was part of Mitchell's mandate at the Bank of Canada
Their reaction to Quadriga
How Crypto Twitter helped was useful to Mitchell during his time at the bank
What it's like being a Bitcoin enthusiast working at a central bank
Crypto penetration among Bank staff
How Mitchell applied lessons from traditional finance to his analysis of Bitcoin
Mitchell's thoughts on the legitimacy of Tether
Comparing the risk profiles of single and multi collateral Dai
Lessons that Bitcoiners can take from central banking
Whether central banks should be concerned about crypto-dollarization
The prospects for CBDCs
Why the public sector may not be able to create a true digital cash with strong privacy assurances
What a more restricted digital form of central bank money might look like
Mitchell's view of the true killer app of the crypto industry
Mitchell's new project now that he has left the BoC
The one big gap Mitchell has identified in the crypto industry
The likely effect of the rise of crypto markets on central banking

Content mentioned in this episode:

The Bank of Canada's 2018 Bitcoin Omnibus Survey: Awareness and Usage
Chainalysis' 2020 Global Crypto Adoption Report

Mason Borda (Tokensoft) on the convergence of tokens and capital markets (EP.134) Oct 05, 2020

Show notes

Mason Borda, CEO and cofounder of Tokensoft, joins the show. In this episode:

Tokensoft's ERC-1404 standard
Why put securities on chain?
Commonalities between the spirit of securities laws and the values of crypto markets
The possibility of making stock transactions into a real time phenomenon
Transparency through registered security offerings versus on-chain cash flows and freely viewable contracts
How on-chain tokens are transparent and where they should volunteer additional disclosures
Tokensoft's Arcoin and INX issuances
Mason's response to the critiques of the INX offering
Why regular companies don't just "hold their own securities on a centralized database"
DTCC explained for Bitcoiners
How Mason thinks about securities regulation today as compared with 2017
Is the 'complexity defense' sufficient to ward off securities regulators?
Mason's desired approach to the market from the SEC
Lessons that the SEC can take from MAS (Singapore) and FINMA (Switzerland)
The outstanding barriers to security tokens gaining liquidity and market share

Weekly Roundup 10/02/20 feat. Michael Moro (BitMEX goes down, Genesis launches custody, the SEC scores wins) (EP.133) Oct 02, 2020

Show notes

Nic and Matt cover a tumultuous week in the crypto markets. In this episode:

We investigate the Dollar Milkshake Theory
BitPanda raises $52m
Genesis announces the official launch of their custody product
Our breakdown of the BitMEX situation
Where the BitMEX situation leaves the remaining offshore crypto exchanges
The prospects for users who currently have funds on BitMEX
How the BitMEX lawsuit potentially improves the prospects for a Bitcoin ETF
Whether BitMEX was a source of sell pressure for Bitcoin
Where BitMEX leaves decentralized exchanges
The SEC obtains a summary judgment over Kik
Why the SALT lending settlement with the SEC signals a shift in the SEC's attitude with regards to tokens
CommerceBlock converts their token into equity into a UK company
Talos Trading comes out of stealth mode
The biggest remaining systemic risk that the crypto industry faces

Trent and Brock Elmore on Building Yam Finance (EP.132) Sep 30, 2020

Show notes

Trent and Brock Elmore, two of the five creators of Yam Finance, a decentralized finance protocol, join the show. In this episode we discuss:

The inspiration for starting Yam Finance
The story behind the launch, the initial bug and the subsequent re-launch
Contextualizing DeFi – what is a fad and what is enduring
The future for Yam Finance and the long term sustainability of fair launch platforms

To learn more about Yam Finance visit: https://yam.finance/

Chase Lochmiller (Crusoe Energy Systems) on turning stranded energy into Bitcoin (EP.131) Sep 28, 2020

Show notes

Chase Lochmiller, cofounder and CEO of Crusoe Energy Systems joins the show. In this episode we discuss:

Crusoe's approach to addressing the issue of natural gas flaring by monetizing stranded energy
The process by which Crusoe turns this stranded energy into Bitcoin
How Chase sees the compute use cases that can benefit from capturing stranded energy
Chase's career path from finance to crypto to founding Crusoe
The impact that successfully climbing Mount Everest has had on his career.

To learn more about Crusoe Energy Systems visit their website.

Weekly News Roundup 09/25/20 (Bank custody for stablecoins, two new congressional bills, "stablecoin" vs "cryptodollar") (EP.130) Sep 25, 2020

Show notes

Matt and Nic return for deals and the news of the week. In this episode:

The OCC clarifies that banks can custody dollars for stablecoin issuers
Maker's flippening in collateral types, and what that means for the system
Tether falls below 80% of stablecoin market share
Two congressional bills propose to federally regulate crypto exchanges and tokens
"Stablecoins" or "cryptodollars"?
Cambridge AltFin releases their long-awaited cryptoasset benchmarking report
The prospects for big tech antritrust
What to replace the 60/40 portfolio with

Content mentioned in this episode:

OCC, OCC Chief Counsel's Interpretation on National Bank and Federal Savings Association Authority to Hold Stablecoin Reserves
Coin Center, Two new bills in Congress would clarify agency jurisdiction over cryptocurrency
Cambridge Center for Alternative Finance, 3rd Global Cryptoasset Benchmarking Study
ECB Crypto-assets Task Force, Stablecoins: Implications for monetary policy, financial stability, market infrastructure and payments, and banking supervision in the euro area
Apolline Blandin on OTB, Estimating Bitcoin's Energy Footprint

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