El Salvador’s bitcoin adoption has “immediate implications” for rating – S&P Global

A illustration of cryptocurrency Bitcoin is seen on this illustration taken August 6, 2021. REUTERS/Dado Ruvic/Illustration/File Photo/File Photo/File Photo/File Photo

LONDON, Sept 16 (Reuters) – El Salvador’s adoption of bitcoin as authorized tender has speedy unfavorable implications for it credit score rating S&P Global mentioned on Thursday.

S&P mentioned the principle dangers had been that it may threaten its hopes of securing a help programme with the International Monetary Fund, enhance fiscal vulnerabilities and damage banks by creating foreign money mismatches once they dish out loans.

“The dangers related to the adoption of bitcoin as authorized tender in El Salvador appear to outweigh its potential advantages,” S&P mentioned. “There are speedy unfavorable implications for (the)

credit score”.

S&P presently charges the central American nation at B- with a ‘steady’ outlook. Moody’s minimize its El Salvador rating to Caa1, its equal of 1 rating notch under B-, on the finish of July. It additionally stored the rating on a downgrade warning.

Reporting by Marc Jones; modifying by Rodrigo Campos

Our Standards: The Thomson Reuters Trust Principles.

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