I think that's a good point if you know you're dealing with merchants who immediately convert back to fiat.

However, if you don't know what they do after the transaction, this seems like a really organic way to grow the Bitcoin ecosystem. You're spending the same amount either way (minus the transaction costs of converting to Bitcoin), but now the merchant is potentially more integrated into the Bitcoin economy.

Undisciplined

bitcoin

Spending Bitcoin - A Weekend Discussion

I would prefer spend bitcoin and earn bitcoin, rather than replace by converting fiat into bitcoin to spend bitcoin again. Also, most merchants that accept bitcoin probably convert it right away to fiat when they receive the bitcoin. So we only convert fiat to bitcoin, spend it and convert it back to fiat instead of creating a bitcoin only circular economy. It only cost more fees and taxes than spending fiat directly. 