1 Why do the Chinese want the CSE?

China wants to become a technology powerhouse with world-class securities markets, but its own exchanges lack the technology, know-how, and regulatory framework to compete globally. By buying the CSE, Chongqing Casin Enterprise Group—which is likely influenced by the government—gains advanced technology (not to mention regulatory status), including that necessary for ultrafast high-frequency trading.

2 Why is this a big deal?

The U.S. government has repeatedly accused the Chinese of trying to steal U.S. trade secrets and technology. A group of 46 congressmen recently expressed concern that CCEG could use the exchange to learn proprietary information, disclosed by companies in their regulatory filings, and transfer it to Chinese competitors.

3 What’s the worst-case scenario?

That the Chinese government uses the exchange to assault U.S. financial markets, thereby endangering our economy. Chinese leaders have already proved their readiness to manipulate stock prices: Last year, the government halted trading in that country for long periods and urged companies that are largely state owned to prop up share prices with stock purchases. If China’s leaders are involved with CCEG—which we don’t know for sure—government-directed trading might happen here, too, especially since the company has said it wants to list more Chinese companies on the CSE.

4 Might this deal be stopped?

Possibly. Regulators need to approve it before it goes through. Given that this is the first American exchange that a Chinese enterprise has tried to buy—and that so many members of Congress are recommending that the feds closely review the deal for national security risks—the veil will likely come off CCEG. If the company looks too cozy with the Chinese government, the sale isn’t going to happen.

Fishman is the author of the New York Times bestseller China, Inc.