During this time many things are banned in China, in the end they make their own. It is not impossible that China wants to create its own cryptocurrency that can be government legality
It is not the thing happening now, from last some couple of years it has been a strategy of Chinese to ban something. They make some notorious news about it, and after much profit and technicalities from it, they call it useless and harmful and then ban.
Same, they did with bitcoins. Chinese are one of the main integrities of bitcoins success that maximum exchanges were working in china.
I think China should take into account that there are too many people. After the introduction of new business, there are bound to be many new challenges. It is also a particularly big challenge to the economic system. Therefore, China did not dare to accept bitcoin while cryptography was not yet ripe .