It's normal that 94-year-old Buffett doesn't understand Bitcoin! Is it reasonable that you, at 30, don't copy homework?

As two legends in the investment world, Munger has passed away, and Buffett has also stepped down. Throughout their investment careers, they have expressed negative views on Bitcoin. However, when Buffett first discussed Bitcoin, he was already in his 80s, and Bitcoin was only 5 years old. But you’re different—you might be in your 30s, with 50 years of investing ahead. The entire lifecycle of Web3 could span your remaining investment years. If you don’t buy today, what about in 10 years?

The Three Real Reasons Buffett Rejects Bitcoin

It’s normal that Buffett doesn’t like Bitcoin; he also doesn’t like gold. Buffett says those assets don’t generate cash flow, meaning you have to rely on later buyers to buy at a higher price to profit, rather than the “business value” they produce themselves. This is the core of Buffett’s value investing philosophy: investments should be based on a company’s intrinsic value and cash flow-generating ability, not market speculation.

However, this investment philosophy itself has temporal limitations. When Buffett talks about Bitcoin, he’s already in his 80s or 90s, approaching the final years of his investment career. Why take a gamble on a new field? New domains need decades to mature—at least, the internet took over 20 years to reach its fast lane, and when Buffett first discussed Bitcoin, it was only 5 years old. For Buffett, Bitcoin’s maturity will occur after his lifetime, so spending time researching it has no practical meaning.

More critically, there’s the issue of capital scale. Buffett manages tens of billions of dollars in Berkshire Hathaway. Even if Bitcoin’s market cap surpasses 1 trillion dollars today, it still remains “inaccessible” to Buffett. To allocate 5% of his capital into Bitcoin, he would need to buy $50 billion, a scale that would severely distort market prices. Since he can’t make such large allocations, what’s the point of him understanding it? Same with段永平—though his managed funds are less than Buffett’s, he still has hundreds of millions of dollars. He has 30 years of investing left but doesn’t need to understand Bitcoin because he can’t buy in.

The Three Gaps Between Buffett and Young Investors

Age Gap: When Buffett was 80 discussing Bitcoin, he had only 10 years left in his investment career. You’re 30, with 50 years ahead waiting for Bitcoin to mature.

Capital Scale Gap: Buffett can’t buy Bitcoin with his hundreds of billions, but your capital can be flexibly entered and exited.

Era Gap: Buffett grew up in the industrial age; you grew up in the digital age. Your cognitive structures are fundamentally different.

Demand Gap: Buffett has proven he doesn’t need to take risks; you still need to seize the opportunities of the era to achieve a leap in wealth.

Learning Cost Gap: Buffett’s learning in new fields yields very low returns; learning about Bitcoin could benefit you for a lifetime.

Capability Circle Is Not a Cage but a Boundary That Must Be Expanded

Everyone knows that investing should be within their capability circle. But what exactly is the scope of this circle? Is it that after understanding the market in your twenties, you can stay there forever, never investing outside that circle? Of course not. The capability circle must be continuously expanded to increase your range of options. For Buffett’s lifecycle, his understanding of “business” as a capability circle is sufficient, but you are different. The decades of change you will experience are beyond what Buffett can see or needs to experience.

Ironically, even if you copy Buffett’s approach entirely—entering at the same entry point and over a 20-year cycle—you almost won’t beat the index. This is because Buffett only realized the importance of technology stocks later, after buying Apple. This case proves that even Buffett must expand his capability circle late in life to enter the tech sector and maintain excess returns. If Buffett needs to expand his circle, what reason do you have to stick to old fields?

Your investment capability circle is not innate; everyone expands it from zero. When should you continue expanding, and when is it better to stay within your current scope? The answer depends on four scenarios: must expand, must not expand, can expand, and should expand. When you encounter an asset or field you must understand, you must expand; but when this new thing is completely isolated from you and unlikely to relate for a long time, don’t waste time understanding it—like Buffett’s capital scale or their remaining investment years. These are cases where you must not expand.

For Bitcoin and Web3, young investors face the “should expand” scenario. This field may not become mainstream tomorrow, but sooner or later, you’ll intersect with it. If it becomes mainstream, like the internet, everyone will hold some Apple stock or NVIDIA stock. Can you not hold them? Each generation has its own things—Buffett’s era was Coca-Cola and Wells Fargo; yours might be Bitcoin and Ethereum.

Young Investors Should Model Themselves on Young Buffett

You should model yourself on how young Buffett approached new opportunities in his era. How did he gain more than other participants from those opportunities? Not as a young person copying the aging, nearly retired Buffett, or the elderly managing enormous funds.

Young Buffett was aggressive. In the 1950s, he studied emerging industries like television, retail chains, and insurance—these were “new economy” sectors at the time. Buffett didn’t stick to traditional manufacturing but actively expanded his capability circle into fields his mentor Graham didn’t fully understand. This openness to new opportunities created Buffett’s early excess returns.

Modern young investors should learn this attitude, not Buffett’s conservative stance in his later years. When Buffett was 30, he didn’t say, “I’ll wait 50 years for these companies to mature before investing,” but instead actively researched and boldly invested. Similarly, you shouldn’t wait for Bitcoin’s market cap to increase tenfold and become fully mature before entering—that way, early participants will have already captured the excess returns.

People are like this: if Buffett and Munger say that drinkers are fools, even a follower of theirs might say, “Screw it, old man, he’s not right about everything—at least he doesn’t understand alcohol.” This selective acceptance of authority shows everyone has their own standards. Buffett’s negative view of Bitcoin shouldn’t be a reason for you to avoid research, just as his abstinence from alcohol shouldn’t be a reason for you to quit drinking.

Moreover, Buffett himself admits he makes mistakes. He missed the best entry points for Google, Amazon, and Microsoft, which caused Berkshire Hathaway to lose potential gains worth hundreds of billions. His mistakes in tech prove the risk of sticking rigidly within one’s capability circle. If even Buffett can’t perfectly predict the future, what reason do you have to blindly trust his judgment on Bitcoin?