Net fiat invested is the amount of fiat money (e.g. USD, EUR, JPY, etc.) you invest into your current cryptocurrency holdings. Formally, net fiat invested is the total amount of fiat currency invested into crypto assets minus the total amount of fiat currency received from your crypto sales.
Note that this number can be zero if all your crypto is a gift, if you have never bought any cryptocurrency, if you are a merchant who only gets crypto as a form of payment (but never pays for it), or if you sell your cryptocurrency for the same amount that you paid for it with fiat currency. Net fiat invested can also be negative, for example, if you sell your cryptocurrency for more than it cost to buy it in the first place.
Cost basis is the total fair market value of your currently held crypto assets at the time you acquired them. This value is used to determine the capital gains tax when you sell your crypto assets.
Cost basis and net fiat invested can diverge when the value of your cryptocurrency holdings changes. For example, if someone gifts you Bitcoin and it appreciates in value, then you take on the donor's cost basis at the time of the original purchase of that coin), however your net fiat invested is unchanged. Also if you trade a bitcoin for Ether, then your cost basis will adjust to incorporate the sale of the Bitcoin and the purchase of an ether at fair market value, whereas your net fiat invested is still unchanged. Similarly if you get a forked asset (e.g. Bitcoin Cash from your Bitcoin holdings), then your cost basis will increase accordingly, however your net fiat investment is unchanged.
On the other hand if you buy $1,000 worth of Bitcoin, your cost basis and net fiat invested both increase by $1,000. The same applies in reverse if you sell $1,000 of Bitcoin (both cost basis and net fiat invested decrease by $1,000). Transfers within a user’s wallet don’t affect net fiat invested nor cost basis. Note that while net fiat invested can be negative, cost basis is always a non-negative number.
Here are some examples to make it clearer:
*Based on FIFO (first-in first out) calculation