All of the “Big Three” credit agencies have said that the introduction of Bitcoin in El Salvador could negatively affect the country’s creditworthiness. After both Moody’s and Fitch Ratings published reports on the matter in El Salvador, S&P Global said the introduction of Bitcoin had “an immediate negative impact on its creditworthiness.”
S&P Global joins Fitch Ratings, Moody’s criticizes Salvadoran Bitcoin introduction
On August 17, 2021, Bitcoin.com News reported on Fitch ratings describing El Salvador adopting Bitcoin (BTC) as the legal currency, the country can push towards “regulatory and operational risks”.
In addition, Fitch said that the introduction of Bitcoin would have a negative impact on the insurance system in the Latin American country. The Fitch Ratings report in August followed Moody’s Downgrade in June after the Big Three credit agency downgraded the country from a B3 rating to Caa1 and highlighted a “deterioration in the quality of policy making”.
S&P Global seems to agree with Fitch and Moody’s and on Friday, a report von reuters.com points out that the credit agency S&P Global noticed “immediate effects” after the country introduced Bitcoin (BTC). One of the biggest risks is getting support, said S&P from programs like the International Monetary Fund (IMF). In addition, the report states that S&P is planning an “increase” [in] fiscal vulnerabilities. “
“The risks associated with the introduction of Bitcoin as legal tender in El Salvador appear to outweigh the potential benefits,” S&P said Thursday. “There are immediate negative effects for [the] Credit. “Thomson Reuters’ Marc Jones points out that El Salvador currently has a B rating, which means it is stable.
The latest statements from S&P Global follow recent actions in El Salvador. For example, protesters took to the streets on September 15 and shut down a bitcoin cash machine (ATM). on fire. In addition, a complaint filed with the Salvadorian Court of Auditors by a human rights organization called Cristosal calls for the Salvadoran government to be investigated into Bitcoin ATM transactions and kiosk construction.
What do you think of the recent statements from S&P Global about the introduction of Bitcoin as legal tender in El Salvador? Let us know what you think on this matter in the comments below.
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