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More architectures are feasible with the way modern open-source makes software available. Breaking up the hegemony of x86 in the data center is a good thing.
Sanctions incoming...
?

Sanctions can prevent US tech from being exported to China. They can't do a thing about home-grown tech.

Sanction may not be the right term but I'm there's a way to punish them for being Chinese and possibly being sold to Iran, Russian or Palestine at some point...
Not quite. US can e.g. sanction Alibaba such that TSMC/Samsung is not allowed to fab Alibaba's chips.