How can the government discover I own BTC, let's say I'm from Venezuela where crypto is banned, what they can do to discover and arrest me?
Bitcoin transactions are anonymous. As long as you don't reveal your identity, no one know you are a bitcoin holder.
For this purpose you have to buy bitcoin peer to peer from a person you trust. Never use exchanges that force you to verify your identity.
Inspite of all these assumptions, there are still cases where bitcoins transactions has been tracked by law enforcement agencies like FBI and others and this goes on to show that it's really not that anonymous as we thought that it was and therefore can be traced.