This would automatically shift demand to digital gold, aka Bitcoin. If that happens, you can expect China to take action restricting purchases of Bitcoin in some time. So a short and quick raise in bitcoin's price would be followed by a dump. 
Don't bet on it. First of all, it will boost smuggling and black market activity. Bitcoin is a niche product, only few people are aware of it as an investment alternative. The direct impact of China news on Bitcoin prices is greatly exaggerated
But gold is a niche product too
How much physical gold is being freely traded on commodity markets? I don't think that much, relative to the amount of gold held in vaults or used for jewelry. Indeed, this amount will still be far greater than the volume of bitcoins traded. But let's not forget two things. First, not many people can actually buy gold, since you can't buy, say, 0.1 gram of gold (even 1 gram gold plates pass more like jewelry) but you can easily buy bitcoins worth of that much gold. Second, most of bitcoin trading today is done on Chinese exchanges, thus the Chinese buyers constitute the majority of Bitcoin buyers across the world. In this way, we can well expect that the likely shortage of gold could be partially compensated by bitcoins in the future. Bitcoin is a gold substitute as a store of purchasing power, at least, to a degree (just like the US dollar)