This is pretty much the whole story right here...
" NIFA official Li Lihui told a technology conference in Shanghai on Friday that a goal of Chinas monetary regulation is to ensure that the source and destination of every piece of money can be tracked. "
Bitcoin is the mortal enemy of '
tracking'. Therefore China is going to continue to assault Bitcoin from every angle. You can be sure of that.
It is really quite simple why they do hate bitcoin. Bitcoin is decentralized and takes control away from the government. Same with any government, especially China who wants to retain a tight grasp over the economy and how people transact with each other.
Therefore, they want to regulate it to the point that it becomes unfeasible for anyone to use bitcoin. Shut down exchanges, ban ICOs, etc.
But, p2p trading will always exist. Bitcoin will live, even if china hates it and decides to ban it completely. People will still run bitcoin software, and the network will live on.