they could have just announced to the whole world that they've banned crypto instead of making life difficult for crypto enthusiasts by introducing unfriendly rules and preventing businesses around it by blocking exchanges and other business initiatives with sanctions.
They want control and adoption preventive measures without bringing down the ban hammer. The more people flee their grip by dumping centralized fiat and buy bitcoin, the more they are going to push back and add more restrictions. Specially with the worsening economy, the fear will continue to grow about more people finding the "exit" called bitcoin...