Trans-Pacific View author Mercy Kuo regularly engages subject-matter experts, policy practitioners, and strategic thinkers across the globe for their diverse insights into U.S. Asia policy. This conversation with Winston Ma, Esq. — investor, attorney, author, and adjunct professor in the global AI-digital economy; partner of Dragon Global, an AI-focused family office; and adjunct professor and executive director of the Global Public Investment Funds Forum at NYU School of Law — is the 515th in “The Trans-Pacific View Insight Series.”
Describe the reasons behind the exclusion of investors from China and Hong Kong in the SpaceX IPO.
The most striking fact about the SpaceX exclusion is that it came from the American side, not from Beijing. Underwriters led by Goldman Sachs and Morgan Stanley were instructed in early June to reject all orders from mainland China and Hong Kong, citing ITAR [International Traffic in Arms Regulation] compliance on defense-adjacent aerospace technology. That order came a full week before the offering priced on June 11 at roughly $135 a share, valuing the company near $1.8 trillion and raising about $75 billion, the largest IPO in history.
In our 2020 interview, we discussed my book “The Hunt for Unicorns,” where I documented how CFIUS [the Committee on Foreign Investment in the United States] and FIRRMA [the Foreign Investment Risk Review Modernization Act of 2018] steadily expanded what counts as sensitive technology. Rather than risking a drawn-out, retrospective national security challenge that could complicate the deal after closing, SpaceX voluntarily executed an aggressive jurisdictional pre-clearance – private screening done before any regulator forced it. A U.S. company voluntarily excluding the world’s second-largest pool of investable capital tells you how normalized national-security self-restriction has become for any American firm with dual-use technology and global capital ambitions.
Explain the significance of Beijing’s State Council Decree 837 and Trade Secret Regulation.
Decree 837 was born from the Meta-Manus case – the first time Beijing ordered a completed transaction unwound under its foreign investment security review framework, establishing that re-domiciliation to Singapore does not sever China’s regulatory reach over technology it considers strategically Chinese in origin. Signed June 1 and effective July 1, it now codifies that principle into a formal 34-article structure governing outbound technology transfer. A parallel Trade Secret Regulation, the first major revision since 1998, newly classifies AI model weights, algorithms, and training data as protectable state assets.
As a lawyer admitted in both New York and China, I consider this China’s own “CFIUS moment”: the same substance-over-form logic Washington has long used to block inbound deals, now deployed by Beijing to control outbound ones. The “Singapore washing” strategy – relocate, reincorporate, then sell to a U.S. buyer – is now formally dead. Decree 837 is that conclusion arriving as statute.
Examine the content and impact of Xi Jinping’s January 30 Politburo speech published in Qiushi.
If Decree 837 is the defensive architecture, Xi’s Qiushi directive is the offensive blueprint. Published by the CCP magazine Qiushi on May 31, five months after delivery, his speech names quantum technology, biomanufacturing, hydrogen and fusion energy, brain-computer interfaces, embodied intelligence, and 6G as China’s “new economic growth points” to be cultivated through “extraordinary measures.”
This is not a model-layer speech; it directs state resources at the layers below and beside AI models – energy, human capital, embodied intelligence – the same foundation the National AI Fund’s subsequent DeepSeek investment was built on.
The sequencing tells you that Beijing’s AI strategy is architectural. As I argued in The Diplomat in 2021, it builds the entire stack, layer by layer, with the legal framework and the capital deployment moving in coordinated sequence.
What is the Chinese public perception of the SpaceX IPO?
This is the question Western coverage answers least well, because the framing inside China differs fundamentally. The exclusion has been read domestically less as punishment and more as confirmation – evidence that China’s own frontier companies must build comparable capacity rather than wait for access to American capital markets. That was the same logic behind DeepSeek’s decision to run its V4 model natively on domestic Huawei Ascend silicon rather than restricted Nvidia chips, at roughly one-seventh the price of comparable Western models.
Having spent a decade inside China’s sovereign capital system, I would describe the dominant reaction as muted rather than aggrieved. Domestic capital markets were already pricing frontier technology assets as strategic infrastructure rather than ordinary equity before the exclusion was announced. The SpaceX restriction does not introduce a new grievance; it closes a loop both sides had already started closing from their own side.
Assess the repercussions of the SpaceX IPO on China-U.S. competition for AI sovereignty and dominance.
As I observed in a recent Financial Times op-ed, Trump is taking a page out of China’s sovereign AI playbook. The headline is that both countries are now actively pursuing sovereign AI strategies. In June, China’s National AI Fund secured the only voting-rights stake in DeepSeek’s first outside funding round – a 50 billion yuan raise in which the Fund’s own position carried voting rights and no lock-up, a structure every other investor was denied. The same month, the Trump administration was exploring equity participation in OpenAI, building on the precedent of its $8.9 billion equity stake in Intel last year.
The SpaceX IPO exclusion is the same sovereign logic expressed as restriction rather than acquisition: control over who is allowed inside the stack, not just who owns it. Every institutional investor with cross-border AI or hard tech exposure is now operating under two simultaneously hardening regimes. The competition for AI sovereignty is no longer about who builds the better model — it is about who controls access to the capital, the chips, and now the public markets that fund the future growth.
