Those who have KYC coins but have moved them to cold storage, have multiple addresses that can’t be proven to belong to the same person who purchased them on an exchange. The transactions may have gone to North Korea or anywhere.

So the question is, do they assume ownership regardless, and tax according to the purchases *only*?

If the coins remained on a KYC crypto exchange, they would have proof of ownership and then basis for their (absolutely unfair) taxation.