Some big cities like this were controlled by some big sects, but most of them were controlled by an Alliance formed by some high-level cultivators. Such cities were all autonomous.
In a big city like this, it was generally built by some individual cultivators. Then, they would unite with people of the same status and slowly build it. In the process of building it, they would slowly recruit and sell soldiers. Finally, such a city was formed. They would also establish their own family forces in this city and rule these cities for generations.
Therefore, there were a lot of experts in big cities like this. The city's controllers were all businessmen who paid particular attention to harmony and wealth. They were very polite to everyone and would not offend anyone. In addition, such Trading Places were very important to all cultivators, so the major sects acquiesced to their existence.