My take on China's embrace of Bitcoin is not that it will help it with police-statesmanship, but simply that they really don't like the USG dollar, and would love if the international monetary system made a little more sense. Right now, Japan, Germany, and China (mostly) buy enormous amounts of US treasuries at tiny/negative interest, only to see them defaulted on little by little at the pace of inflation (which is of course paced by the USG). China doesn't really believe in fiat currency, definitely not at the state level. They should know, they invented paper currency back in the day. Instead, they buy precious metals (and other metals, they stockpiled copper during the gold boom a few years back), and I think they see something very similar when they look at Bitcoin. They see gold 2.0, at any rate, a contender to become the world's reserve currency, only with better liquidity than gold, less inflation (you can mind more gold into existence, but Bitcoin is capped at 21 million), and harder to forge.