[cgore]

My guess is that the Chinese miners are often well-connected in the middle-levels of the Chinese government, the parts that actually implement such policies, and only a few less-connected miners would actually get blocked, thus increasing the profitability of the miners with government connections.

[elevensies]

I'm wondering if it would benefit them to be cut off from the world, but not each other.

Lets say China creates a partition in the bitcoin network between inside China and outside China. My understanding is that when they remove the partition, the longest blockchain "wins". If there is more mining power inside China than outside, that gives them the power to deny everyone outside China the ability to do transactions for the duration of the partition.

The network could be divided other ways, but I believe China is the only one who has the ability and incentive to do it. Although maybe you're right that the miners are connected enough to prevent it (I'm sure it would create chaos that would hurt them in the end). Although I don't know if the firewall is administered at the provincial level or the national level? I think it is much less likely for them to have national level connections since I believe the Chinese political system is controlled by ~100 people.

[contingencies]

AFAIK mining doesn't actually require connectivity until you want to reveal the block. It's unlikely anyone else will discover it quickly, so you can just have someone walk across a border (or get on a flight) and plug it in to the global network from elsewhere.

[mason55]

Blocks are supposed to be found every 10 minutes (difficulty adjusts to maintain this average). Theoretically someone would find the next block 10 minutes after you found yours and they would broadcast it. Then the next block would be found on top of that one. So unless you could get your block broadcast in under 20 minutes your chain would end up as shorter than the other one and wouldn't be counted as the main chain and it would quickly die.