You certainly can deduct business expenses in excess of your revenue. I've done it. The thing is, it has to be an actual business intended to make money. You can deduct hobby expenses (for example) only up to hobby revenue, and that applies to most other revenue.
When I was deducting business expenses, I was told that the IRS has a three-of-five rule. If your business is profitable three years in five, then they assume you're a legit business unless they find out otherwise (and they're unlikely to). If it isn't profitable three years out of five, the IRS is going to assume that it's probably a fake business intended as a tax dodge, and you'd better be prepared to show them that you're operating a true business.
You really can't buy anything real-world useful with WoW gold, so the IRS will only tax you on what you sell it for, and you can deduct your subscription cost up to your revenue (if you're running a real business, even if illicit, the IRS is a touch more generous). Suppose I have extra WoW gold and want to buy a computer with it. I'll first convert it to real money (and that's taxed) and then buy the computer.
Bitcoins, on the other hand, are a sort of currency in themselves. You can buy things directly with bitcoins (as bitcoin proponents point out whenever there's a /. article on bitcoins), and therefore they're taxable just like money. If I mine bitcoins and use them to buy a computer, I now have a computer, just as if I'd farmed cash (which I do about 40 hours a week, really). You can of course deduct your expenses, but you're going to owe taxes.
Note: I am neither a lawyer nor an accountant. This is neither legal nor illegal advice. Consult an actual reliable source before relying on anything I say. This posting is not for use in operating nuclear power plants, etc.