Why did China ban cryptocurrency?

I think the core reasons why China banned crypto- has been pointed out by Zann, China's maintaining control over its money supply. In recent years, China has been losing internal control of its money, from isolated scandals such as Zhang Ziyi's hidden tax defaults, to constantly identifying leaks to offshore leakages through shadowbanking and various asset classes such as Properties, Forex. It is not surprising China reacted quickly to the news and eliminated the possibility of outflow via Cryptocurrency.

Hello! As mentioned by Sandra, since cryptocurrencies is entirely self-governed, the the Chinese government could be concerned over the increasing power and popularity of digital currencies,something that could potentially weaken the official control of China’s money supply. Thus, it is likely that they banned cryptocurrencies so as to ensure that they will not lose control over China's money supply.