This book analyzes the effect of financial internationalization and financial crisis on international and country level financial risk and financial stability, and it summarizes the experience of international and country level financial regulation system reform and its inspiration on China. The author studies the current situation and existing problems of China's financial regulation and proposes the countermeasures to enhance financial regulation. Based on these analyses, a direction for China's financial regulation reform—that is, functional regulation—is proposed, as well as a design for the framework and corresponding steps to implement it.