When Bitcoin Falls, I Finally Understood the Cathedral and the Casino

Categories: Share 2026-02-01

When Bitcoin falls, it becomes easier to distinguish between the casino and the cathedral. As Bitcoin dropped from its $120k peak to around $70k, panic swept through the market once again. During previous major stock market crashes, I kept recalling Buffett’s metaphor from the 2024 shareholder meeting—capitalism is a combination of a cathedral and a casino. Price volatility is the casino’s noise, while what truly determines long-term returns are those cathedrals that require a century of devotion yet continuously create structural value.

Today, I happened to watch Naozong’s YouTube video “The Key to Identifying the Next Trillion-Dollar Opportunity: Transcendence”, which gave me a more systematic understanding of this metaphor. Many investment disagreements don’t stem from information gaps, but from differences in cognitive levels. Standing in the casino, you naturally only see chips and odds. Standing in the cathedral, you see time, faith, and collaboration. I highly recommend everyone watch this video.

I wanted to record some of the key insights from it, combined with my own investment reflections, into an article. Hopefully, it can provide some psychological comfort to those shaken by the market crash.

Three Cognitive Levels of Investing

1. Level One: Animal Cognition: Completely driven by instinct, chasing rallies and dumping on dips, relying on immediate feedback—like seeking thrills in a casino. This cognition focuses on short-term dopamine hits rather than long-term value. The result is typically becoming the retail investor repeatedly harvested by the market.

2. Level Two: Rational Cognition: People at this level start reading financial statements, calculating valuations, building models, and focusing on revenue, profit, cash flow, and competitive moats. This is the foundation of traditional value investing. This path is necessary but not sufficient. Excessive rationality can easily trap you in path dependence. Like Nokia back in the day—they could precisely calculate that touchscreen phones were costly and immature at the time, yet completely missed that Apple was redefining the very species of “phone” itself.

3. Level Three: Transcendent Cognition: This is what Naozong’s video repeatedly emphasizes. Investors need to look beyond financial data to identify whether a company carries a mission that transcends short-term profits. A genuine mission can galvanize large-scale, long-term collaboration and attract top talent—because these exceptional people don’t lack money; they lack a sense of purpose in their work. Such companies can also transform users from consumers into believers. People aren’t buying products; they’re buying identity and belonging. These companies aren’t just running businesses—they’re advancing a sufficiently grand, long-term narrative.

How Do You Judge Whether a Company’s Mission Is Genuine?

Not all visions deserve to be called missions. Many are just meant to deceive investors. To judge whether it’s legitimate, look at these three dimensions:

1. Is the founding team willing to sacrifice short-term returns?: A genuine mission always comes with real costs. Whether founders and core team members are willing to forgo short-term monetary gains for long-term goals is the most direct and credible signal.
2. Are they willing to persist for a long time?: True missions typically have decades of historical continuity, not visions hastily cobbled together in fundraising materials. Many seemingly overnight successes are actually backed by extremely long cycles of intellectual and technological accumulation.
3. Would the world be affected if this company disappeared?: If this company vanished, would the world lose something important? Is the social value it creates significantly greater than the commercial profit it extracts? A true cathedral makes the entire ecosystem better because of its existence.

Is Value Investing Still the Same Old Playbook?

I believe value investing needs to evolve in the AI era. I remember previously sending my portfolio to Claude for analysis. I thought I was a value investor, but Claude said: “This isn’t value investing at all—it’s ‘high-cognition-driven growth trend investing + options and leverage-amplified aggressive style.’” That really brought me back to reality.

Based on the framework we just discussed, value investing hasn’t failed—it’s been forced to upgrade in the AI era. Traditional value investing emphasizes moats, while transcendent cognition focuses more on a lighthouse effect—whether a company illuminates an entirely new value space.

From calculating value to recognizing narratives. Classic value investing is about buying certainty at a discount, while transcendent cognition is about judging which dollar-valued things might become worth a hundred dollars in the future—because they’re pioneering entirely new continents and creating tremendous value.

Market volatility is actually your friend. When Bitcoin falls, when the market questions companies making huge long-term investments with ambiguous short-term returns—that’s often when the divergence between transcendent cognition and mainstream rational cognition is greatest. It’s also the best window for calm observation and deep research. Based on this, I remain bullish on Bitcoin. It’s more like a long-term narrative that needs time to validate, not a trade requiring frequent entries and exits.

You Need to Accompany Companies with Transcendent Characteristics

Investing in cathedral builders is more about companionship than trading. You need farmer-like patience, accepting long periods without feedback. Retail investors are more like plants, craving daily sunlight and price changes. Top investors are more like cathedral builders, thinking on timescales of decades or even centuries. The higher your ecological niche, the stronger your ability to endure hunger and lack of feedback.

After watching Naozong’s video, I was pondering which companies today could be considered to possess transcendent characteristics. After much thought, these few stand out, especially Musk’s companies. I’m very much looking forward to SpaceX’s IPO this year.

1. SpaceX: Persists in the ultimate mission of Mars colonization, reconstructing aerospace costs through first-principles thinking, establishing a monopoly at the launch capacity level. Its true value isn’t in how much revenue each launch generates, but whether this technological pathway ultimately pushes humanity toward the long-term goal of interplanetary survival.
2. Tesla: Trying to break free from the inherent linear growth constraints of manufacturing, continuously investing massive resources into full self-driving and embodied intelligence. Essentially, it’s betting that AI’s reconstruction of physical world productivity will indeed happen exponentially.
3. Bitcoin: Building a value network based on mathematical consensus rather than centralized credit. It proves that even without a CEO or financial statements, relying solely on code and shared belief, you can support a trillion-dollar economy. Each violent correction is more about squeezing out short-term speculators while reinforcing long-term consensus.
4. NVIDIA: Spent nearly fifteen years continuously advancing a software-hardware integrated computing ecosystem, gradually shifting the computing paradigm from general computing to accelerated computing, ultimately positioning itself as foundational infrastructure in the AI era.
5. Palantir: Used seventeen years as a private company to refine its core systems, focusing on solving the most complex and critical data problems, establishing an irreplaceable ecological niche in defense and core industries. Its value isn’t reflected in quarterly revenue but in whether it becomes a foundational capability of the digital world.
6. OpenAI/Anthropic: With a core mission of AGI benefiting all humanity, continuously bringing together top scientists for long-cycle research, forming a leading advantage in the fundamental paradigm of artificial general intelligence. Their long-term value doesn’t depend on current revenue models but on whether they truly shape the next generation of genuine AGI.

How Do You Find the Next Generation of Such Targets?

First, you need to look for those that may not be favored or even mocked at this stage. Companies with truly transcendent missions seem like science fiction early on. Some might think it’s a joke, just like when Nokia mocked Apple, or when Toyota’s Akio Toyoda publicly stated multiple times that Tesla’s pure electric was overhyped, believing electric vehicles were unrealistic and that hydrogen and hybrid were the right direction. Now, that proved wrong too.

Second, you need to watch the direction of talent flow—not the flow toward smoky money-grabbing influencers, but whether top engineers and scientists are willing to take pay cuts to join, whether long-term capital is willing to support in non-standard ways. These are often more convincing than any other metrics. This is why so many brilliant engineers desperately want to work at SpaceX.

Third, you need to see whether the developer ecosystem is thriving. The density of developer communities, upstream and downstream entrepreneurs, and research activities is a key signal for measuring long-term positive externalities. Developers and ecosystems drive prosperity. One reason Apple’s AR glasses haven’t taken off is that the developer ecosystem inside them is far smaller compared to mobile app development.

Fourth, you need to accept current ambiguity and nonlinearity. They may only have investment and vision for a long time, then explode at a certain critical point. I remember watching a video where NVIDIA’s Jensen Huang went to Xiaomi’s product launch to drum up support for himself. Looking back now, it’s really quite touching.

Staying Clear-Minded Amid Casino Noise

I feel these three points can serve as repeated reminders, like psychological massages for ourselves:

1. Beware of rational hubris. Using a perfect model to prove that disruptors are overvalued is often the most dangerous moment, because disruptors aren’t priced that way.
2. Let time participate in judgment. True missions often seem absurd in the short term but inevitable in the long term. You need to wait patiently for the flower to bloom.
3. Maintain patience where no one cares. When narratives are ridiculed and prices are depressed, it’s often a window for research and positioning. When it becomes universally accepted, or when retail investors start piling in, you should exit—or that’s when you recognize you’ve misidentified a transcendent target.

Truly long-term excellent businesses are almost always mission-first. Organizations with transcendent missions, even if weak today, are more likely to grow stronger over time. Organizations that lose their mission, even if strong today, will inevitably decline—it’s just a matter of time. For example, I believe Apple under Jobs belonged to an organization with a transcendent mission, while Apple under Cook is more of a company that loves making money. The difference is huge.

In a market full of casino noise, identifying and long-term accompanying those still building cathedrals, not being swayed by short-term volatility, and not betraying long-term judgment for immediate profits—this may be the scarcest and most important investment capability of this era.

Finally, as a novice investor still in the beginner stage, far from the insights of the pros, this article likely has many imperfections. I don’t recommend that those unfamiliar with investing blindly jump in. This type of investment carries high risk and requires caution, as you could lose a lot of money.