Big Three Credit Agencies Criticize Adoption of Bitcoin by El Salvador – S&P Global Warns of ‘Immediate Negative Implications’ – Bitcoin News
All of the Big Three credit bureaus have said that El Salvador’s adoption of bitcoin could negatively affect the country’s credit rating. After Moody’s and Fitch Ratings published reports on the matter in El Salvador, S&P Global said the adoption of bitcoin had “immediate negative implications for its credit rating.”
S&P Global joins Fitch Ratings, Moody’s criticism of Salvadoran bitcoin adoption
On August 17, 2021, Bitcoin.com News reported on Fitch Ratings detailing that El Salvador is adopting bitcoin (BTC) as legal tender can push the country towards âregulatory and operational risksâ.
Additionally, Fitch said the adoption of bitcoin will negatively affect the Latin American country’s insurance system. Fitch Ratings report in August followed that of Moody’s downgrade in June, after the ‘Big Three’ credit agency upgraded the country to Caa1 from B3 and highlighted a ‘deterioration in the quality of policy making’.
Global S&P seems to agree with Fitch and Moody’s and on Friday a report from reuters.com says credit agency S&P Global notices “immediate implications” after the country embraces bitcoin (BTC). One of the biggest risks is getting support, S&P said, from programs like the International Monetary Fund (IMF). Additionally, the report states that S&P is considering an “increase [in] fiscal vulnerabilities.
âThe risks associated with adopting bitcoin as legal tender in El Salvador seem to outweigh its potential benefits,â S&P explained Thursday. âThere are immediate negative implications for [the] credit. âMarc Jones of Thomson Reuters points out that El Salvador currently has a B- rating, which means it is stable.
S&P Global’s latest statements follow recent action in El Salvador. For example, protesters took to the streets on September 15 and set up a bitcoin automated teller machine (ATM) on the fire. In addition, a complaint filed by a human rights organization called Cristosal sent to the Salvadoran Court of Auditors wants the Salvadoran government to be investigated for ATM bitcoin transactions and the construction of kiosks.
What do you think of the latest statements from S&P Global on El Salvador’s adoption of bitcoin as legal tender? Let us know what you think of this topic in the comments section below.
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