Obviously transactions on the blockchain are public and addresses can be tied to info provided by exchanges. But what about creating a second wallet or multiple wallets that are not connected to any exchange or traceable to an individual? Or can multiple wallets be connected (for example by Chainlink) in ways that I can't imagine because of my limited tech knowledge?
The tax collector is going to have a tough/impossible time tracking taxable events if they are not done on exchanges or through other companies that track customers.
You didn't mention which country. That is very important.
In the U.S., residents and citizens must pay U.S. taxes on gains. Currently, the IRS relies on the taxpayer to be honest, but they can also get information from U.S. exchanges and companies. If they suspect that you are not paying taxes, they may investigate you further. You don't want the IRS to investigate you, so it is probably better to be honest.
... Become a State citizen. ... check the box that says you are not a U.S. citizen ... if you are a State citizen, and not a U..S citizen, you only owe State taxes ... State taxes are based on Federal which you don't owe... no taxes.
I doubt that works since you are subject to U.S. taxes if you live in the U.S., whether you are a citizen or not.
https://www.irs.gov/businesses/taxation-of-nonresident-aliens-1