For starters, the government is allowed to simply ask "we think that maybe you might have had some income in the form of cryptoassets. Please provide an exhaustive list of such income" with the understanding that any lies or omision on that answer changes it from "how much do I need to pay tax?" question into a "go-to-jail-for-how-long" tax fraud.

If they find your answer suspicious (for example, it doesn't match some third party info that they have e.g. from a TLA running a honeypot tumbling service, or a honeypot 'trade crypto for cash in a park' op or Tor node monitoring or whatever, all these things are being done by gov't), then this can be followed up by a tax audit (i.e. have you purchased any assets or services that are above your declared income?) and/or a warrant to search your devices (possibly without you knowing) for forensic evidence of your crypto transactions - which might, for example, result in evidence that you used a coin-join service with an intent to circumvent KYC/AML laws, which by itself can be treated as a crime even if they don't find definitive proof that you owned coins at a particular address.