
A year ago Alibaba founder Jack Ma gave a speech that would upend his business empire.
Ma told an audience in Shanghai that it was time to “change the pawnshop mentality of today’s finance.” His comments were provocative both in content and timing, coming less than two weeks before his giant fintech company Ant Group was scheduled to go public.
Regulators pulled the plug on Ant’s IPO two days before the due date, in turn setting off China’s year of ‘crackdowns’ — a wide-ranging series of regulatory and political moves that have reined in some of China’s most valuable companies.
This week, The Wire looks back at the year of upheaval for private enterprises in China, taking stock of which sectors have been affected, and the companies and institutions to watch.

FINTECH
What happened: After Ant’s IPO was shelved, China’s central bank told it to rectify violations across its product lineup. The e-payments platform had expanded into consumer lending, insurance, and wealth management, putting it in competition with China’s state-owned banks.
The results: Regulators are reportedly moving to break up Ant, according to a Financial Times report from September, requiring that it separate its e-payment business from its consumer lending units. Ant would also have to turn over user data to a new partially state-owned credit scoring company, part of efforts to sever Ant’s information monopoly. Other fintech companies have been told to make similar changes.
Companies to watch: Ant, Tencent (owner of WeChat Pay)
SOCIAL MEDIA AND E-COMMERCE
What happened: As China’s central bank cracked down on Ant, the State Administration for Market Regulation (SAMR) launched an antitrust investigation into e-commerce giant Alibaba, putting dozens of other tech companies on notice. Regulators have focused on practices such as platforms preventing merchants from selling goods on competitors’ sites.
The results: The SAMR fined Alibaba a record-breaking $18 billion RMB ($2.8 billion) in April. It then ordered 34 more internet companies to rectify their anti-competitive practices and “heed Alibaba’s example.” This month, food-delivery giant Meituan was fined $530 million, making it the second tech giant to be hit with penalty for antitrust violations this year.
Companies to watch: Tencent, ByteDance, JD.com, Baidu were among those warned in April
U.S. IPOS
What happened: Ride-hailing platform Didi Chuxing went public on the New York Stock Exchange in late June, surprising Chinese regulators, who reportedly believed Didi would postpone the listing until it had addressed their concerns about data security. Officials from seven government agencies visited Didi’s offices while the powerful Cyberspace Administration of China (CAC) alleged the company had illegally collected users’ data. The CAC also announced probes into Full Truck Alliance (Manbang) and Boss Zhipin, two other Chinese firms which had recently listed in the United States.
The results: Several Chinese companies have shelved their U.S. listing plans, including LinkDoc, a medical data platform, and audio platform Ximalaya. New rules unveiled in July mean any company holding data on more than 1 million users must apply for CAC approval when seeking to list overseas.
Companies to watch: Didi, whose daily users have dropped 30 percent since its IPO; Ximalaya, which has since applied to list in Hong Kong, where the IPO pipeline is quickly filling up.

TUTORING AND FOR-PROFIT EDUCATION
What happened: The cost of raising a child in China has soared in recent years. In July, the government banned for-profit tutoring in school curriculum subjects, and tutoring during vacations and holidays. In August, it banned firms from hiring overseas teachers.
The results: The decision has decimated the value of some of China’s biggest for-profit education companies. Others like ByteDance, TikTok’s parent company, have shut down their education divisions and laid off hundreds of employees.
Companies to watch: New Oriental Education & Technology Group (down 90 percent year-to-date), Gaotu Techedu, TAL Education (both down 94 percent year-to-date). VIPKid — once valued at over $3 billion — has had its entire business model effectively outlawed.
BITCOIN MINING AND CRYPTO EXCHANGES
What happened: China had come to dominate global bitcoin mining, a highly energy-intensive process. But in May, Inner Mongolia outlawed mining to cut its energy consumption, with several other provinces following suit. China’s central bank ordered banks not to provide services for cryptocurrency transactions in June, and banned all such transactions last month.
The results: Prices for bitcoin and other cryptocurrencies fell on last month’s announcement, though it’s since recovered. Many bitcoin miners have moved from China to Kazakhstan and the U.S., especially Texas.
Companies to watch: Binance, Huobi, two of the top exchanges worldwide, both of whom were founded in China but have gradually been pushed out.

FAN CLUB CULTURE AND CELEBRITIES
What happened: Internet users have long participated in a raucous fan club culture, organizing crowdfunding campaigns to promote their favorite celebrities. Beijing referred to the phenomenon as “chaos” this summer, and has moved to break up some fan groups and discipline some of the celebrities involved.
The results: Chinese authorities fined actress Zheng Shuang over $46 million for tax evasion in August. Another top movie star, Zhao Wei, has disappeared — her image and name scrubbed from the internet — for reasons unclear, although some have speculated about her financial links to Jack Ma. Authorities have also criticized ‘effeminate’ men and banned them from TV.
People to watch: Zhao Wei, whose whereabouts remain unknown; K-pop groups like BTS, which critics have derided as ‘insufficiently masculine.’
ALGORITHMS
What happened: China’s tech companies prize their proprietary algorithms, which have helped the likes of ByteDance’s TikTok become global social media sensations. Now, Beijing wants to regulate their use, citing their “inappropriate application” as a disruptor of market and social order and a “challenge to the protection of ideology.” In August, the CAC said algorithms should not be used to entice users to spend large amounts of money. In September, a joint announcement by nine regulators laid out a three-year plan for setting up rules for their use.
The results: Some companies are already making changes. Last month, food delivery app Meituan adjusted its algorithm rules in response to state criticism about worker exploitation. The changes are also affecting the talent behind the technology: in August, the former director of ByteDance’s AI Lab announced he was leaving to take up an academic post in the U.S.
Companies to watch: Any that make heavy use of recommendation algorithms like ByteDance, Taobao, and delivery apps like Meituan, Ele.me
REAL ESTATE COMPANIES
What happened: For years, China’s property developers borrowed recklessly to fuel a nationwide homebuilding spree. Last year the Chinese government introduced “three red lines” for developers, aimed at capping their borrowing. A recent analysis by the Financial Times found that over half of China’s top 30 developers cross at least one of those lines.
The results: Several developers are now in deep financial trouble. Sinic defaulted on its loans this week, while Fantasia has been downgraded by three credit rating agencies to default status. The elephant in the room is Evergrande, which missed an interest payment deadline on several dollar bonds in September. There is no sign yet that the government intends a bailout.
Companies to watch: Evergrande Group, Fantasia, Sinic, Xinyuan Real Estate, Modern Land
CASINOS
What happened: Chinese authorities have long sought to tighten scrutiny over activity in Macau’s casinos. Now, Beijing wants to increase oversight of the casino operators themselves with supervision from government representatives. Other proposed measures include powers to review casinos’ profit distribution and a focus on ‘quality’ over quantity when granting new licenses.
The results: Casino operators’ share prices tumbled in mid-September after the proposed measures were announced. All six operators’ licenses (known as concessions) are up for renewal in 2022. Analysts expect that they will be approved, but that concession terms will be shorter than before.
Companies to watch: The six operators: SJM, Galaxy Entertainment, Wynn Macau, Sands China, MGM China, Melco Crown
STATE BANKS
What happened: The crackdown isn’t all about private capital: China’s formidable anti-corruption body is now scrutinizing state-owned financial institutions. In mid-October, the Central Commission for Discipline and Inspection (CCDI) dispatched inspectors to 25 financial companies, including the big four state-owned banks and conglomerates like Citic Group. Investigators appear to be scrutinizing their links with private firms such as Evergrande, which was able to secure cheap loans from firms like Citic, despite government warnings.
Companies to watch: Citic Group, China’s big four banks (ICBC, CCB, Bank of China, ABC), Huarong Asset Management, China’s bad debt manager

Eliot Chen is a Toronto-based staff writer at The Wire. Previously, he was a researcher at the Center for Strategic and International Studies’ Human Rights Initiative and MacroPolo. @eliotcxchen