Billionaire investor Chamath says 'information asymmetry' helped Warren Buffett till 2000: Here's what he means

Social Capital founder Chamath Palihapitiya highlighted in his The All-In Podcast that ace investor Warren Buffett’s investment performance was dependent largely on “information asymmetry”, revealing how regulatory changes fundamentally altered returns for even the world’s best investors.

“Now I’m gonna get a lot of people really upset with me. This is an example of Warren Buffet’s returns pre- and post-Reg FD. Now what do you see? His returns were double the market returns when this kind of information sharing was legal. And the minute that it became illegal and you had to act on the same edge as everybody else, his returns went to the market return. He generated zero alpha. In fact, he probably, on the margins, lost a little bit,” said Chamath.

“Before 2000, CFOs could tell individual investors things they didn’t tell everyone else. It wasn’t illegal. You’d call your CFO buddy, he’d say ‘quarter was a blockbuster,’ you’d buy the stock.” In 2000, Reg FD made this illegal. You had to act on the same information as everybody else,” he said.

Chamath explains Warren Buffett’s secret to success: “Markets thrive when there’s information asymmetry” “Now I’m gonna get a lot of people really upset with me.” “This is an example of Warren Buffet’s returns pre- and post-Reg FD. Now what do you see?” “His returns were… pic.twitter.com/LXyRZFxt6Q

— The All-In Podcast (@theallinpod) February 14, 2026

He added that prediction markets like Kalshi and Polymarket also need insider trading norms.

“So, this is the single best investor in the world. This is what happens when you have information symmetry. So it’s just meant to explain that markets thrive when there’s asymmetry. Billions and billions of dollars will be made in asymmetry. The prediction markets today, unless they are regulated out of existence or shut down, will look like the stock market pre-Reg FD (Regulation Fair Disclosure, effective 2000) , and there’s nothing we can do except choose not to bet it, because otherwise what you’re going to have are a ton of sharps taking advantage of a ton of squares,” Chamath said.

One X user pointed out data to negate Chamath’s argument.

“The real collapse came in the 2000s decade (which included the dot-com bust and 2008 crisis), with only a partial recovery afterward. Overall from 1981–2025 the CAGR was still a strong 18.09%, but the incremental alpha has largely vanished in recent decades. Buffett himself has repeatedly warned that Berkshire’s growing capital base is a massive headwind. In the 1980s the entire equity portfolio was tiny (well under $1 billion early on), so even modest mispricings or small-company opportunities could move the needle dramatically. By the late 1990s/early 2000s the equity portfolio was already tens of billions; today it exceeds $300 billion (plus hundreds of billions more in operating businesses and float). At that scale, the investable universe shrinks to the largest, most efficiently priced companies on Earth. High-conviction, high-conviction “elephant” bets that can compound at 20–30% become vanishingly rare. This is simple arithmetic, not regulation.

“Equally important is the shift from investment vehicle to operating conglomerate. In the 1980s–1990s Berkshire was essentially a concentrated stock portfolio wrapped in insurance. Over time it acquired and built large operating subsidiaries (GEICO expansion, BNSF Railway in 2009, major utilities, manufacturing, etc.). These businesses generate durable earnings and float, but they compound at more “normal” business rates rather than the 20–30%+ returns available to a nimble value investor deploying small capital into deeply undervalued equities,” said an X user with user name of @Hyperion0213.

Another X user with user name of @Mayhem4Markets accused Chamath of using insider information to sell SPACs.

SPAC is the acronym for “special purpose acquisition company” and is often referred to as a “blank check” entity. SPACs exist to acquire or merge with promising private companies, which would take that company public without the need for an initial public offering (IPO).

“He was paid to endorse SPACs that he knew were garbage companies. At the same time, he promoted himself as this generation’s Warren Buffett. He claimed he was democratizing investor access to early stage companies. Instead, in almost every case, he left people holding worthless bags while he got paid his promotional commission. Now he’s going after Buffett over information asymmetry? The same information asymmetry that he leveraged selling companies he knew were garbage as being the next 10 baggers? The level of smug hypocrisy here is absolutely off the charts,” said the X user @Mayhem4Markets.