"Coinbase will automatically convert all cryptocurrency to US Dollars for use in purchases and ATM withdrawals".

This removes a little friction, but the vendors are not taking crypto. Its not really any different than using a US credit card in a foreign country - the vendor isn't taking USD, even if thats what I end up being billed in (along with the associated fees).

If they do that, they’ll need to follow the same regulations any other bank does.