I have roughly $124k in all my wallets and Koinly says I have a cost basis of $76k.
Over the course of the year, I deposited $112k in my accounts and bought crypto with all of it. My wallet appreciated and I took approximately $26k and put it into NFTs, which show up as outgoing payments in my transaction ledger. My question is the following:
If I deposited $112k from my bank over the course of the year and purchased crypto with every single dollar, shouldn’t my cost basis be at least $112k? Or is the cost basis only referring to the cost of the crypto currently in my wallet ($124k)?
All my outgoing transactions correctly register as a tax event since I’m buying NFTs, but I’m wondering if this would affect cost basis in the software, as that crypto used to buy the NFTs obviously cost something. I’m just very confused by how I could have purchased $112k worth of crypto but only have a basis of $76k. Does selling crypto and buying NFTs change the basis?