Im not listing all the problems with your scam.
No scam here, nighteyes. Charities so far haven't accepted bitcoins because they could not make use of them as bitcoins. Not every charity operator has the time or the skills to operate a trading account. Now that the donation can be quickly converted to dollars that the charity can actually use, bitcoins become a viable option. Regarding recordkeeping, it is up to the donor to keep track of their cost basis for tax purposes. All they get from the charity, or from bit-pay, is a receipt for the donation. But with a unique bitcoin address, the transaction can be verified in the blockchain.
"1. We don't fully understand the complex legal issues involved with creating a new currency system
2. We don't want to mislead our donors.
3. People were misconstruing our acceptance of Bitcoins as an endorsement of Bitcoin."
So no, it wasnt because they could not make use of them.
#2 for record keeping, giving an IRS agent a unique bitcoin address will not satisy the record keeping requirement. You need either a bank withdrawl or payroll deduction. No charity should be authorizing deductions if they dont know who actually gave it. And even if the IRS gave you that point(they wont), good luck explaining the 'verification' in the blockchain. Just wait until someone says they gave $500 and you say it was $100 and start explaining blockchains and bitcoin to the charity.
It is possible to send bitcoins to charity, just not that way. I proposed a 501c3 charity that will accept the bitcoins that will then restrict that donation to be used for the donor purposes...however, there is the issue of the board of directors...and also an open transaction/books system, where the open-source computer program does the transfering without humans....granted I was told the open books system is impossible and probably will be hacked anyway.
