Cost basis is the total amount you paid to acquire an asset, including any fees or commissions. It is the baseline against which a gain or loss is measured: sell above your cost basis and you have a profit, sell below it and you have a loss.
Getting it right matters most at tax time, since the taxable gain is the sale price minus the cost basis. When you have bought the same asset at several different prices, the basis is usually an average or is tracked lot by lot, depending on the accounting method.
Fees belong in the calculation on both ends — they raise your cost basis when buying and reduce your proceeds when selling. Ignoring them overstates your true gain. Tax treatment varies by country, so this is general education, not tax advice.
Worked example
Buying a share for $100 plus a $1 fee gives a cost basis of $101; selling at $150 is a $49 gain.
This definition is general education, not investment advice. Markets — especially crypto — are volatile and you can lose money. Please read our disclaimer and see our methodology.