China has decided to put pressure on it's citizens so they do not use bitcoin by treating jail time. What's new, anything a Government can't control they don't want the people to have. This should in the long run make the bitcoin even more valuable. The United States will most likely take the same action in the days to come as they too are a very repressive Government but I don't think the U.S. citizens will roll over and play dead in the same way. Just try it with most Americans and I think your going to see the people there telling them where they can go.
One of two things will happen when they start doing this kind of thing. Those Governments who decide to do this will ether meet massive resistance or many people will leave the dictatorship they are in.