Nine Days After the Bund Speech

Published October 4, 2026

On October 24, 2020, Jack Ma stood at the Bund Finance Summit in Shanghai. He had founded Alibaba. He chaired Ant Group, China's largest financial-technology platform. Fintech, in this use, means a technology company that does the work of a bank or a lender. Ant was days from a listing that the financial press treated as settled, and that would have been the largest initial public offering on record. An IPO is the first sale of a company's shares to the public. Ma used the room to attack the regulators who could stop it. He compared China's financial rulebook to a pawnshop mentality. He dismissed the Basel Accords, the international rules that tell banks how much capital they must hold against losses, as a seniors club built for aging Western systems with nothing to teach China's credit business. He told the officials that regulation should not fear innovation, that chasing zero risk was itself the greatest risk, and that China's financial future belonged to technology platforms rather than cautious bureaucrats.

The audience included senior people from the People's Bank of China, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange. All four were reviewing Ant's plan to list in both Hong Kong and Shanghai on November 5. The Shanghai STAR Market price was 68.8 yuan a share. Expected proceeds were above 35 billion dollars. Retail and institutional investors had oversubscribed, meaning they had asked for far more shares than were for sale.

Nine days later, on November 2, the four regulators summoned Ma, Ant's executive chairman Eric Jing, and its CEO Simon Hu to a joint meeting. The Chinese word was yuetan. It translates roughly as a formal interview. Inside the bureaucracy it means a dressing-down. The same day the central bank and the banking regulator released draft rules for online microlending that would rebuild Ant's core business. On November 3 the Shanghai Stock Exchange suspended the IPO, citing material events and a changed regulatory environment. Ant withdrew from the Hong Kong listing the same day.

Jack Ma left public life. He was not seen or heard from for nearly three months. He had been a regular face at the World Economic Forum and a regular conversation partner for foreign heads of state. When he appeared again in January 2021, in a short video, he said nothing about the IPO, nothing about the regulators, and nothing about the pawnshop line.

Over the next two years, Chinese technology companies lost about 1.1 trillion dollars in combined market value. Venture capital in China's internet sector, the money that funds young companies, fell 80 percent, from 49 billion dollars in 2021 to 10 billion in 2022. The Ant IPO has not been revived.

The new lending rules, dated November 2, 2020, required online microlenders to carry at least 30 percent of the default risk on loans they originated. As of June 2020 Ant had been carrying about 2 percent. Ant had run at effective leverage of 50 to 60 times its capital. Ordinary banks run nearer 13 times. Leverage, here, is how much lending sits on a given pile of the company's own money. Ant collected the fees and the customer relationship and left almost all the losses with partner institutions. The new rules closed that gap. In June 2021 the banking regulator licensed Ant to set up a consumer-finance subsidiary, with capital rules that changed the economics of its most profitable line. By January 2023 Ma's voting rights in Ant had fallen from over 50 percent to 6.2 percent. The Hangzhou city government took a minority stake in the consumer-finance subsidiary. A private company had a city government on the cap table.

The State Administration for Market Regulation opened an antitrust campaign against the big platforms. In April 2021 it fined Alibaba 18.228 billion yuan, about 2.8 billion dollars, for abuse of a dominant position. The specific practice was called choosing one from two: merchants had to sell only on Alibaba's platforms or face being pushed down by the algorithm and losing marketing support. In October 2021 Meituan was fined 3.442 billion yuan for similar exclusivity against food-delivery merchants. In 2021 the agency collected 23.6 billion yuan in antitrust fines, about 52 times the 450 million yuan collected in 2020.

Didi took a different path. On July 1, 2021, three days after it raised 4.4 billion dollars in a New York Stock Exchange listing, the Cyberspace Administration of China announced a cybersecurity review of the ride-hailing company and pulled its app from Chinese app stores. Regulators said Didi had gone ahead with the American listing after the cyberspace agency told it to wait. The company's data covered 23 million drivers and 492 million consumers, including real-time city transport and mapping that Beijing treated as sensitive. A year later the review ended with an 8 billion yuan fine and a finding of serious violations. The agency declined to say what the violations were, citing national security. Didi left the New York exchange in June 2022.

Two laws followed. The Data Security Law took effect in September 2021. The Personal Information Protection Law took effect in November 2021. Both gave the cyberspace agency authority over Chinese data moving to foreign jurisdictions. Fines could reach 50 million yuan or 5 percent of the prior year's revenue, whichever was larger. In August 2021 the National Press and Publication Administration limited online games for minors to three hours a week, one hour each on Friday, Saturday, and Sunday. By September 2022 the population of young gamers in China was about 40 million smaller than in 2020. Companies were answering the market regulator on antitrust, the cyberspace agency on keeping data inside the country, the banking regulator on capital, and industry regulators on their own sectors, with no shared safe harbor that told a firm when it had complied enough.

The financial case for touching Ant is the part the chapter says is hardest to wave away. Ant originated consumer loans at huge scale and held almost none of the downside. If the loans failed, the partner banks that held them would take the hit. The central bank and the banking regulator had been writing down fintech leverage worries since at least 2017, when China set up a Financial Stability and Development Committee aimed at shadow banking, lending that sits outside ordinary bank rules. The peer-to-peer lending collapse of 2018 had already shown what happens when lightly regulated intermediaries run without enough capital. Ant's leverage was larger than even aggressive platforms of that kind. Research from the Hertie School of Governance found that antitrust enforcement after 2021 measurably cut concentration in digital markets, sharpest in the sectors Alibaba, Tencent, and Baidu dominated. Pinduoduo's later gain in market share fit the idea that breaking lock-in lets smaller platforms in. Didi's database, once the company was listed in New York, would have sat under American subpoena power and under FISA, the U.S. law that authorizes certain foreign-intelligence access. Elizabeth Economy, writing from the Hoover Institution, noted the mirror: Chinese firms holding critical infrastructure creates problems for American competitors, and the reverse is also true.

Wall Street Journal reporting identified investors tied to Jiang Zemin's factional network inside Ant's opaque ownership. The listing would have consolidated wealth for networks Xi had spent years pushing aside. The Journal also reported that Xi personally intervened to halt the IPO. Minxin Pei, a political scientist at Claremont McKenna College, has argued that the Chinese system produces partial reform traps: reform is real, and it stays incomplete because finishing it would threaten the party's control. Applied here, the four agencies were chasing financial stability and answering a political order to punish visible dissent at the same time, through the same people.

The wreckage is what separates the episode from a tidy rule change. Alibaba's share price fell more than 75 percent from its 2020 peak. Ant, valued at 313 billion dollars before the suspension, completed a share buyback in 2023 at a valuation 70 percent lower. Didi shareholders who bought at the IPO price of 17 dollars watched the stock fall to about 4 dollars by 2022. LinkedIn and Yahoo left the Chinese market, citing compliance costs and rules they could not predict. IPO-related funding in early 2024 was down 79 percent year over year in onshore markets. After the guidelines, monthly startup entry in platform-adjacent industries fell 18.72 percent and monthly investment fell 26.73 percent. Victor Shih, at the University of California, San Diego, said the uncertainty left a deep negative mark on the sector and on relations between the state and business. Martin Miszerak, a visiting lecturer at Renmin Business School, argued that cutting Ma from majority control to 6.2 percent told every private entrepreneur that economic contribution was not protection.

After mid-2022, with deflation pressure and slower growth after zero-COVID, the intensity eased. Local governments started courting the tech giants with partnerships and tax breaks. Beijing's state planner publicly called Alibaba a key contributor to strategic priorities. By 2023 policymakers were presenting themselves as pro-growth and pro-innovation. The chapter notes the problem with that walk-back. If the crackdown had been only about lasting structural dangers, those dangers do not vanish when GDP slows. The same months were when the United States was putting export controls on semiconductors and limiting Chinese access to advanced chips for artificial intelligence. By late 2022, state-backed venture funds, including investments by state-owned enterprises, were 78 percent of venture funding in China.

The chip drive is the same pattern at a larger bill. In September 2014 Beijing set up the National Integrated Circuit Industry Investment Fund, known as the Big Fund, to cut dependence on foreign chip suppliers, a dependence Xi had called a core vulnerability. By 2024 total Chinese state-led semiconductor investment was above 150 billion dollars, about three times the American CHIPS and Science Act. The Information Technology and Innovation Foundation estimated that China's yearly semiconductor support since 2014 matched what the CHIPS Act put up as a one-time package. Made in China 2025 had set 50 percent domestic self-sufficiency by 2020. China reached 16.6 percent. The 2025 target was 70 percent. By late 2025 the projection was about 30 percent. The integrated-circuits trade deficit had grown to 240 billion dollars by 2020, nearly double the 2010 level.

In mid-July 2022 a corruption investigation went through the industry's senior ranks. Lu Jun, former head of Sino IC Capital, the firm that managed the Big Fund, was placed under investigation. Ding Wenwu, the fund's former general manager, was investigated by the discipline commission. Zhao Weiguo, chairman of Tsinghua Unigroup, one of the fund's largest recipients, was eventually given a suspended death sentence for embezzling 65 million dollars in state assets. From late March through August 2022 the Big Fund made no investments. Of the first-phase capital, only 1.3 percent went to equipment companies and 1.4 percent to materials science, the places where replacing imports mattered most. The money went to chip design and to expanding foundries, the factories that make chips, which still depended on foreign tools that American export controls would soon restrict. From January to October 2022 more than 58,000 new integrated-circuit firms registered in China. More than 13,000 of them had converted from unrelated businesses to catch the subsidies. Analysts called it the three-nos problem: no semiconductor experience, no technical know-how, no talent. In 2003 the Hanxin fraud had already shown the pattern. A scientist repackaged Motorola chips as domestic designs and took more than 100 million yuan in subsidies. The Big Fund repeated the vulnerability at a much larger scale.

In August 2023 Huawei unveiled the Mate 60 Pro, running a 7-nanometer chip designed by HiSilicon and made by SMIC without EUV lithography equipment. A nanometer, in chip talk, is the scale of the features on the silicon. EUV, extreme ultraviolet, is the newest light used to print the smallest features. American officials had said China could not make 7-nanometer chips at scale. The phone showed they were wrong about the capability, if not yet about doing it cheaply at volume. SMIC used older deep-ultraviolet machines pushed through multi-patterning, printing the same layer several times. It cost more and wasted more, and it worked. In foundational chips, those at 28 nanometers or larger, China's global share rose from 19 percent in 2015 to 33 percent in 2023, and capacity grew more than four times faster than global demand. After U.S. export controls in October 2022, resources shifted toward spread-out supply chains and those older, foundational chips rather than a race at the most advanced node. The corruption investigation had started in mid-July 2022, weeks before the broader October controls, which the chapter reads as suggestive that Beijing already thought the national-champion model had failed and was using the purge to move the money. By late 2025 domestic equipment suppliers had 35 percent of the equipment market, above revised expectations. Whether the adaptation is enough, and whether the corruption burned years that cannot be replaced, the chapter leaves open.

Economy has argued that Xi's centralizing reforms made the system less adaptable than it appears, so that when it finally moves against a threat it overcorrects. The financial worry about Ant was real. The antitrust cases were about real exclusivity. The data worry about Didi was defensible. The machinery that did those things was the same machinery that disciplined a man who had spoken on the Bund. Ma's voting stake ended at 6.2 percent. The IPO scheduled for November 5, 2020, did not happen. The Mate 60 Pro went on sale in August 2023 with a chip American officials had said would not exist.