Here's my rough explanation:

Provisions were added into the bill that would require "know your customer" type requirements and taxation of crypto exchanges but were written so poorly that the requirements could be extrapolated to crypto miners, staking, etc.

This is what happens when people who don't understand the technology in the first place try to write legislation at the last minute to insert into a bill that has nothing to do with crypto.

Amendments have been proposed to try and clarify the bill, but there are multiple amendments that are "worse" or "better" for crypto. Guess which one Janet Yellen is pushing? (after receiving millions from big banks for "speaking engagements."

No, they say it's about taxes but there's much more in it. The bill appears to require everyone in crypto (exchanges, miners, stakers, maybe even software developers) to do KYC on every transaction. This either requires massive technical changes or more likely all those entities would leave the US.

So if I send you Bitcoin without KYC, I'm breaking the law? And it would be trivial to detect if I ever crossed a major exchange

Honestly we don't know. The original bill is vague and there are two competing amendments that are being debated. It will take some time for this to shake out.