"Fiat" generally means "the government has said so", while in most cryptos* there are various mathematical rules meant to stop anyone just saying so. They call it bitcoin "mining" precisely because you can't just say "look, I've got a new bitcoin" in the same way you actually have to dig for and refine gold. Last week on the other hand the Bank of England simply said "look, I've got £65 billion to help out pension funds."
That most people believe the Bank of England and a lot of people believe the pope, and not so many people believe in Scientology or will accept bitcoin for groceries is, however, all down to human belief not inherent reality. "Fiat" is referring to the process for creating of new units of currency, not its utility for buying and selling stuff.
Anything based on belief can be workable and appear "real" for a long time, but that doesn't make it actually real. Compare with things based on real physics, like that 100 grams of gold dropped on a bare human foot from 1.5 metres will hurt said foot, no matter who's head might be stamped on the back.
* "Most cryptos" is important because to that extent I agree you that crypto coins are invented like fiat: nothing stops anyone saying "hey, I've invented XYZcoin and I'm a trillionaire." That's not likely to be a popular or useful coin though, but again that's down to human belief.