You missed the point. The point was that there are many ordinary and mundane reasons why you wouldn't be able to prove the full chain of custody for the BTC you acquired in 2012. It would be a real practical concern if you are a law-abiding person. If you're a criminal, it's not much of a concern since laundering money is relatively easy.

Yes but the claim is those are hard to track details, and then what's described is a timeline of consistent interaction with the money which you're now planning to claim you have no knowledge of.

And some of those interactions are taxable events - e.g. if you are exchanging out of cryptocurrency denominations, then by US tax law as a US citizen that was a taxable event.

[1] https://www.blockpit.io/tax-guides/crypto-tax-usa

Chris Borden went to prison for Bitcoin related financial malfeasance.

https://youtu.be/cuIRvn89988

Was he actively involved in money laundering, theft, fraud, or tax evasion?

Did the jury have reasonable grounds for voting to convict?

He sold Bitcoin without doing KYC and went to prison for operating an exchange. He sold Bitcoin to someone he knew was somehow involved with cocaine. I don't know how morally wrong what he did was, but legally it sent him to prison.

This seems to be... WAI. And not just a guy getting punished for doing a few perfectly legal trades. It's hard to do all of the above by accident.