So Frank travels around the world and is now dating Sonya from the Philippines.
Frank donates his bitcoin to Sonya by sending it to her BTC address.
Sonya now goes to her bank in the Philippines and wants to convert her BTC, received as a donation, to fiat currency that she can spend with Frank.
The bank is asking for a transaction history, but she does not have one because it was a donation.
What happens then?
There is a lapse on where she has sold the bitcoins. If sending it to her, it won't automatically be on her bank and so she had to choose an exchange and method of selling through them or p2p. If she's going to choose P2P then she can cash out through other means and doesn't have to go through the banks. It's the last process and if the banks are too complicated with money sent from crypto transactions, they better not do that because almost all banks have an allergy with that kind of transfer.
In the future, I think it's gonna get much more difficult for banks to trace where exactly the BTC came from.
For most people it just sat there in a hardware wallet and the link to the original purchase is not hard to demonstrate.
But that will change over time, especially when BTC is regularly exchanged between people in different jurisdictions.
Why would the bank need to trace BTC transactions? it will be costly for them to do so if they'll use some service just for tracking, like chainalysis.