El Salvador’s bitcoin adoption has “immediate implications” for rating
By Marc Jones
LONDON (Reuters) – El Salvador’s adoption of bitcoin as legal tender has immediate negative implications for it credit rating S&P Global (NYSE:) said on Thursday.
S&P said the main risks were that it could threaten its hopes of securing a support programme with the International Monetary Fund, increase fiscal vulnerabilities and hurt banks by creating currency mismatches when they dish out loans.
“The risks associated with the adoption of bitcoin as legal tender in El Salvador seem to outweigh its potential benefits,” S&P said. “There are immediate negative implications for (the)
S&P currently rates the central American country at B- with a ‘stable’ outlook. Moody’s cut El Salvador’s rating to Caa1 (NYSE:), which was one less than B-. The rating was also maintained on a downgrade notice.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. You should be aware of all the potential risks and expenses associated with trading in the financial market. It is among the most dangerous investment types.