Do payment processors who convert bitcoin to dollars (like Coinbase and Bitpay) devalue bitcoin? My understanding is that Coinbase and Bitpay process payments made in BTC.  They receive BTC from a buyer (for example someone buying patio furniture) and send USD to merchants who don't want to keep bitcoin (for example Overstock.com).  In order to get the USD to send to the merchant these companies must be constantly selling BTC on an exchange and thereby devaluing bitcoin.  Is my logic correct?
For every Bitcoin they sell, someone else had to obtain that Bitcoin. So they increase the demand for Bitcoins by at least as much as they increase the supply.

In addition, they increase the utility of Bitcoins, which increases their value. All other things being equal, a currency you can spend at more merchants is more desirable than one you can spend at fewer merchants.