From what Iknow, Chinese residents cannot pay for goods or services using bitcoin; banks and other financial institutions cannot deal with bitcoin; bitcoins cannot be sold by e-commerce sites; and e-payment services cannot be used to pay for bitcoin. So what is left?
Lots of things are left - including: Storage of value, exportation of capital from country and speculation.
Sorry to repeat, but they cannot "export capital" with bitcoin.
When a Chinese national buys bitcoin with Yuan from other Chinese, transfers the bitcoins to another exchange outside China, and sells them there for dollars, the net result is that the Chinese national got some dollars from non-Chinese people. All the Yuan remained in China. The PBoC sees nothing wrong in that, quite the opposite.
That is different from when Chinese citizens exchanges Yuan for dollars at a foreign bank, in China or outside it, since in thsi case the bank effectively becomes owner of some of China's real wealth.
As for store of value, there are zillions of options that are better than bitcoin.
The only substantial thing left is speculation. I wonder how many people are involved in that. My guess is less than 10,000, which would be less than 0.001% of the population...