I made a mistake in my wargame scenario. The current bitcoin code has rules against accepting larger blocks or blocks with the wrong number of bitcoins mined. So if the CCP forced a new protocol on Chinese miners the result would be an immediate fork; all existing exchanges and organizations outside the sphere of the CCP would not even see the CCP fork as the regular bitcoin blockchain would just keep progressing. The only impact users worldwide would see is a drop in hashrate and slower blocks for a couple weeks.
Meanwhile the Chinese miners would be producing a blockchain no one outside the CCP cares about, values, or is even aware of. The best the CCP could do is stick the same gun to the head of Chinese exchanges and demand they list CCP-BTC (and presumably delist BTC). But users would learn of the difference and that it is worthless outside China, so the value would be only a tiny fraction of bitcoin’s price, if it got any traction at all. And that means the massive Chinese bitcoin mining industry would be hemorrhaging money at a huge rate producing almost nothing of value despite huge electrical and hardware expenses.
I’m just beginning to learn about bitcoin, all of this is new to me. So I have questions if you don’t mind. You said this:
“And that means the massive Chinese bitcoin mining industry would be hemorrhaging money at a huge rate producing almost nothing of value despite huge electrical and hardware expenses.”
Since China has about 1.4 billion people, wouldn’t that provide enough transactions to make it worthwhile for China/China miners to have their own new blockchain?
And couldn’t China also require that any crypto transaction used by an outside business (or individual) must use China’s crypto currency? So many U.S. corporations along with businesses in other nations make huge purchases from China. Couldn’t China just give a choice of purchases made be in either yuan, dollar, or the CCP cryptocurrency?