There are some things that would be difficult, such as playing triads where you need to fret three strings, BUT You can play the I-IV-V progression with ALL barre chords, meaning your index finger would always be straight and you use it as a capo.

Because the IV chord is always underneath the I, you simply drop down for the IV and then across for the V. 

You can play rhythm guitar for an untold number of songs with just that method. 

Hope that helps.