@seymour1910 and @mvnsnd, yeah it's shredded bits of rubber - I haven't noticed it before last night. I'm not going to buy a new trainer this year, hopefully in 6 weeks it will start to get warmer and I can just ride outside. I will check to see if the tire is rubbing anywhere else, thanks for the suggestion.

@JerrySTL these are my stock wheels and tires that came on the bike, I just got Vuelta Corsa Lite wheels and Continental GP4000 tires, just need to buy tubes then I'll be totally set with a new set of wheels that I will use outside, and when I start doing Crits in March. These will be a backup pair, but I'm sure even with the wear on the back tire it will be fine to ride outside unless it's wet. I wonder if there will be less rolling resistance due to the smoothness of the rear tire.