China also makes most of the ASIC miners, which are paid for in BTC.
Which means there are some Chinese manufacturing companies who hold a ton of Bitcoin.
It would be great to see some competition in the ASIC market, but just like with most things, most people will not be able to match the production costs of making the chips in China.
Labor and electricity is so cheap, regulations are not strict, etc.
China is the perfect place for anything related to Bitcoins, so they naturally have an advantage.
agree with you, the goverment not make difficult regulation to build "mining company" also goverment support digital coin, i read a news some week ago about official cryptocoin of chinese, maybe in future we will see chinese will accept bitcoin as regular currency.