China Said to Freeze New Game Approvals

The world's largest gaming market, China, is experiencing a significant freeze in game approvals, causing disarray among major companies like Tencent and Netease. This freeze, lasting over four months, is due to a government reshuffle and regulatory concerns, including game addiction and violence. The uncertainty has led to a significant drop in Tencent's market cap and a negative investor sentiment, affecting the entire gaming industry. The situation is expected to impact third-quarter earnings and industry-wide growth.

Why are bureaucrats hesitant to take initiative regarding new game approvals?

What potential impact could the ongoing situation have on the gaming industry as a whole?