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Isn't the whole point of saying bitcoin is not currency, but property, that you're not allowed to do this kind of accounting? I'm pretty sure if I buy and sell the same stock throughout the year, I can't simply account for it using the stock's average for the year.

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Special rules apply to stocks, principally because the IRS thinks you should have really good records for your cost basis. If you had acquired them through a dividend reinvestment plan (DRIP) average market price over time is exactly what you'd use.

"If you had acquired them through a dividend reinvestment plan (DRIP) average market price over time is exactly what you'd use."

I think that is allowed for mutual funds, but not stocks.

http://www.irs.gov/Help-&-Resources/Tools-&-FAQs/FAQs-for-In...

If you run a numerical simulation of white noise distribution of buy and sell, you'll find no profit to tax and your buy and sell prices will average close to that number.

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