But then this would be just a digital fiat that they'd use to replace the yuan. I don't see any advantage in this compared to bitcoin. Well, they can do whatever they want, so long as they don't interfere with bitcoin's development and use. If they compel their citizens to exchange their bitcoins for this digital fiat, we could possibly end up with useless bits.
to me i have no idea about this and i am hearing this for the first time. to me i think chines are in majority to use bitcoin as compare to other state of the world most of the miners are also from China. but still i do not think that they can manipulate the price of bitcoin because bitcoin is a universal currency and not a regional one.