That leaves a lot of room for further escalation

If the Chinese authorities follow through their threats and do ban Bitcoin in serious, other countries may follow their lead. As much as I want myself China to be taken out of the picture (preferably for good), it may not end up with China alone but cause a domino effect which would likely have devastating consequences for crypto markets in the long run. Maybe, China is not acting on their own now, and a few major governments have already agreed on banning Bitcoin worldwide in the end (tinfoil hat off)

I do not know what is the point to this post, I did not referred a single time to the Chinese people I was talking about the Chinese government and their policies regarding bitcoin and other altcoins and in that way China moves as an unified force, every Chinese investor is going to move their funds thinking in what is best for them.

Yes, it is better right now for bitcoin to get china out from the market because the manipulation will not occur frequently because if you know, chinese people are one of the pioneers of bitcoin and they have a lot of bitcoin in their country and most of the hashing power are coming from china so if the chinese are out then no more huge manipulations for bitcoin.

And this might be only a tip of the iceberg

Cryptocurrencies themselves are likely only the first step (and not necessarily a very successful one in the long run). It is more about the blockchain technology itself that governments should be afraid of. This is not to say that they shouldn't be afraid of Bitcoin and other cryptocurrencies, but the blockchain could turn out even more dangerous to their power monopoly and hegemony. After all, the blockchain allows people to express their votes directly in a decentralized fashion in a trustless environment, i.e. without some central authority controlling the people's choices and doctoring their votes as it sees appropriate

Bitcoin took off in 2013 due to China and crashed but in 2016, it took off due to its legalization in Japan. Last spring, Chinese exchange sites got suspended but Bitcoin took off any way because of the rest of world, esp  Japan. Rules that was used to apply in the past doesn't always apply in present. The rapid bitcoin price increase from China is not healthy. It doesn't let bitcoin grow organically. It drives prices too rapidly and then crash hard when it goes down. This makes bitcoin look really bad. It makes bitcoin look gambling instead of real currency. This doesn't help bitcoin's wider adoption.  It is True that in the beginning,  bitcoin might need China to be noticed but bitcoin already passed  that stage.