The Chinese government themselves have said there's no way they can ban Bitcoin so any citizen who buys, sells or owns it isn't breaking any law.
Did they really say this? I recall that the Russian government recently said this (shortly after the Chinese exchange ban came to fruition) but I don't remember the Chinese government saying so.
They have however made it extremely hard to buy or sell, even more so if they're blocking access to foreign exchanges too which looks possible. This is cleaner and cheaper than actually outlawing it.
I've already seen screenshots that suggest that foreign exchanges are being blocked. BitMEX was being blocked within China as of a couple days ago, but I can't be sure that they weren't already blocking it before.
So what the average Chinese person is going to face will be a major grind. There'll always be a small cross section of real believers. The rest will leave it alone and walk away which is exactly what the government wants.
If other countries decide they've had enough of crypto this is exactly how they'll do it too. Once exchanges are gone so is most of the audience.
It's tough to say what would happen. China blocked access to Google; how many Chinese residents use Google everyday? Millions, I am sure. Living through the online poker boom and bust makes me think you are correct.
However, this isn't just a hobby. This is matter of securing wealth for future generations. If the rest of the world keeps pushing demand for BTC, Chinese investors won't ignore it, no matter what their government does. They've been defying their government's capital controls for decades.
