What legally prevents a business forming that lets you buy anything with bitcoin

[Monster Tent]

Looks like someone is doing it https://bitspend.net/

They had so many orders their reserve of fiat ran out lol.

If you do this properly you need massive reserves of cash and an unlimited credit card to proxy purchase with.

[Lethn]

That's a very clever idea, I'd be worried about whether the folks at Amazon etc. might take exception to them doing that though.

[flavius]

The problem is bitcoins isn't money, it's an item. It's a trade, not a sale. It's a tax nightmare because ok let's assume you sell a computer you paid $400 for, to someone for $600 in bitcoins at the current market value. Bitcoins aren't currency, so that is not taxable. There is no accounting or paperwork for bitcoins, so you can completely ignore that when tax season comes.

Let's assume the business goes to sell the bitcoins to recoup their $400 investment. They get $600 and technically make a 200 dollar profit, but again there is no legal framework showing that 200 dollar profit. If you hold the bitcoins from the sale and the bitcoin price drops so it is only $300, is that still a profit?

The problem is that bitcoins are not a real currency endorsed by the government.

[sunnankar]

I don't know where you got this idea.  In the US When you trade something or barter it is your responsibility to document the value of the trade in US Dollars and pay taxes as if you sold it for that amount and you can be audited to make sure your methods are valid. 

People should keep in mind there are potential tax consequences when using Bitcoin. However, there are at least four reasonable approaches, not just bartar, that one can take. And record keeping is an important duty also. But Bitcoin is sufficiently flexible for a creative tax planner to work wonders.

Of course, all of this is covered in A Lawyer's Take On Bitcoin And Taxes.

[WishIStartedSooner]

If anybody needs this while bitspend is down PM me friday. I would be able to do it now, but I seem to have developed this compulsion for dumping my disposable income into bitcoin...

Seems like it would be an easy enough business to get started with...

and I bet it would do a whole lot for the bitcoin economy.