Tianjin Tianhai's demise this week highlights "fatal flaws" in the financial models of Chinese football clubs and should serve as a warning to other teams, state media said.
The club was once a symbol of Chinese Super League extravagance, hiring Italian legend Fabio Cannavaro as coach in 2016 and luring Brazilian striker Alexandre Pato and Belgian international midfielder Axel Witsel on vast wages.
It was then called Tianjin Quanjian but the founder of the Quanjian Group was arrested in January last year and subsequently jailed, and the club thrust into the hands of the local football association.
The team was renamed Tianjin Tianhai and struggled to pay the players' wages last year, before announcing on Tuesday that it will disband under a mountain of debt.
The swift downfall of Tianjin, who finished third in the Chinese Super League (CSL) in 2017, shows that Chinese football needs to focus on long-term sustainability, Xinhua news agency said in a strongly worded editorial.
It also warned about the dangers of clubs being dependent on a single, wealthy benefactor.
"The tragedy of Tianhai is enough to warn many other professional football clubs in China," said Xinhua.
"When funds are cut off from the parent company that controls the majority of shares, and a new investor cannot be found, it will only lead to bankruptcy.
"Who out of the other football clubs can guarantee that the same tragedy won't befall them?
"Through the Tianhai tragedy we once again see that most Chinese professional football clubs have fatal flaws in their viability."
Tianjin are among a dozen football clubs in China's top three divisions to go bust since the end of last season, but the first in the CSL.
The club from China's northeast spent 2.2 billion yuan ($310 million) over three years under the Quanjian Group "to buy stars and pay high salaries", Xinhua said.
Tianjin's place in this season's CSL will likely be filled by Roberto Donadoni's Shenzhen F.C.
The campaign was supposed to begin on February 22 but was indefinitely delayed by the coronavirus pandemic. It could now start in late June or early July.