The implementation of Private Investment Funds Regulation marks a significant stride toward establishing a fair and market-based capital market. This regulation encompasses comprehensive protection throughout the fundraising, investment, management, and exit stages, embodying an "all-round protection" framework. Notably, the Regulation strengthens the registration and disclosure requirements for fund managers, and also, clarifies the consequences for the violation of their legal obligations, protecting investors from both ex-ante and post-ante perspectives. On top of this, the inclusion of a special chapter for VC funds demonstrates the efforts of the authority to explore a differentiated approach to private fund regulatory framework.

However, excluding VC funds, the Regulation maintains uniform regulatory requirements to other types of private funds. Indeed, there are common characteristics among private funds. Most of these funds target high-risk investments, emphasizing the qualified investor requirements and non-public offerings during capital raising, striking a balance between investment risk and information disclosure. However, as the market continue to evolve and economic potential is further unfolded, distinctions between different types of private equity funds will become more and more apparent. Certain private funds employ investment strategies with negative externalities, risking market disruption while yielding high returns. Conversely, some contribute to optimizing social resource allocation and job creation but are susceptible to unique conflicts of interest and moral hazards. Thus, recognizing different private fund types and implementing differentiated regulation holds long-term and critical policy value. Private funds could be positioned as the driving force behind the economic, capital, and innovative development of our market.