A few days ago in Hong Kong, I had an interesting encounter. In the morning, I met a friend who has been in the first-tier market for several years, and he told me he wanted to understand how to invest in Bitcoin and Bitcoin mining. In the afternoon, I met a friend who has been doing mining and he said he wanted to establish a fund for first-tier investments. Perhaps everyone sees the tough side of their own field while noticing the glamorous side of others' industries. To understand a new field, the most important thing is to first grasp its challenging aspects. On that basis, if there is still confidence, the hope for success is greater. If one only sees the glamorous side of a field and rushes in recklessly, the chances of suffering losses are high. There is only one true heroism in the world: to love life despite recognizing its harsh realities.

Understanding that businesses with high barriers to entry are good businesses; most businesses that sound easy to understand are often tough ones, and those that make your eyes light up at first glance are mostly traps.

Investing should not only focus on results, as results are often retrospective. What matters is the accuracy rate and the long-term compound annual growth rate, which directly determines whether the capital can grow through compounding over the long term. Any significant permanent loss of principal will directly interrupt the compounding growth curve. The primary source of high accuracy rates is whether the underlying asset is sufficiently anti-fragile, with monopoly (multi-dimensional competitive advantages) being the main source of anti-fragility. A high long-term compound annual growth rate comes from whether the underlying asset has enough room for growth, meaning whether there is a sufficiently large potential overall market for the asset's exponential growth. Both of these judgments should be made before investing. If one only looks at these two factors and focuses solely on investment results, it becomes somewhat misguided and difficult to keep capital on a long-term compounding growth trajectory.