As you know China is a very big country and there are thousands of syndicates and smugglers are residing in that country. The Republic of China's one biggest problem is money laundering  and bitcoin have become a vector for smugglers and criminals to move out dollars from China. China has a strict policy on sending US dollars out of the country and they even set a limit as to how much a family per year can send an amount of dollars. Thus with those syndicates and smugglers using cryptocurrencies as one way of smuggling money out of China the Chinese Authority have decided to place a strict regulations on the exchanges. Those exchanges on the other hand have failed to comply with the new regulations and have decided to shut down its operations.