/biz/ - Business & Finance

This will probably sound like a paranoid lunatics question, so I apologize in advance.

People often use the FUD argument that "Bitcoin is centralized by Chinese market", which is debunked by "Well, other countries can setup miners, too, to balance the power!"

But what happens in this scenario:

1) Bitcoin grows and becomes a stable asset gaining dominance

2) Chinese miners still control majority of Bitcoin mining

3) CCP (Chinese Communist Party) decides that Bitcoin has reached its saturation and its time to take advantage.

4) Similarly to what they did with Jack Ma and Alibaba, they decide now that the mining system is developed they will simply take full control over it.

5) If CCP is running the miners they are able to run them more efficiently, since they have way larger budget and can afford free electricity and all that.

6) At this point CCP is controlling Bitcoin network. What happens? If it is not cost efficient for other countries to setup miners to counterbalance this power dynamic, why would they?

Is this idea over-exaggerated and paranoid?