All of the ‘Big Three’ credit agencies have said that El Salvador’s adoption of bitcoin could affect the country’s credit rating in a negative manner. After each Moody’s and Fitch Scores printed experiences on the matter in El Salvador, S&P World mentioned that the bitcoin adoption has had “speedy damaging implications for its credit standing.”
S&P Global Joins Fitch Ratings, Moody’s Casting Criticism Down on Salvadoran Bitcoin Adoption
On August 17, 2021, Bitcoin.com News reported on Fitch Ratings detailing that El Salvador adopting bitcoin (BTC) as a legal currency may push the country toward “regulatory and operating risks.”
Furthermore, Fitch mentioned that the adoption of bitcoin would negatively have an effect on the insurance coverage system within the Latin American nation. Fitch Ratings’ report in August followed Moody’s downgrade in June, after the ‘Big Three’ credit agency dropped the country to a Caa1 from a B3 rating and highlighted a “deterioration in the quality of policymaking.”
S&P World appears to agree with Fitch and Moody’s and on Friday, a report from reuters.com signifies that the credit score company S&P World notices “speedy implications” after the nation adopted bitcoin (BTC). One of the largest risks is getting support, S&P said from programs like the International Monetary Fund (IMF). Furthermore, the report mentioned that S&P envisions an “enhance [in] fiscal vulnerabilities.”
“The risks associated with the adoption of bitcoin as legal tender in El Salvador seem to outweigh its potential benefits,” S&P explained on Thursday. “There are speedy damaging implications for [the] credit score.” Thomson Reuters’ Marc Jones highlights that El Salvador currently has a B- rating which means it is stable.
S&P World’s newest statements comply with the latest motion that’s been going down in El Salvador. For instance, protestors took to the streets on September 15 and set a bitcoin automated teller machine (ATM) on fire. Moreover, a criticism filed by a human rights group known as Cristosal despatched to the Salvadoran Court docket of Accounts needs the Salvadoran authorities investigated for the bitcoin ATM offers and kiosk development.
