El Salvador's bitcoin adoption has "immediate implications" for rating - S&P Global

September 16, 2021 3:05 PM EDT

FILE PHOTO: A representation of cryptocurrency Bitcoin is seen in this illustration taken August 6, 2021. REUTERS/Dado Ruvic/Illustration/File Photo/File Photo/File Photo/File Photo


News and research before you hear about it on CNBC and others. Claim your 1-week free trial to StreetInsider Premium here.

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 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)

credit".

S&P currently rates the central American country at B- with a 'stable' outlook. Moody's cut its El Salvador rating to Caa1, its equivalent of one rating notch below B-, at the end of July. It also kept the rating on a downgrade warning.

(Reporting by Marc Jones; editing by Rodrigo Campos)



Serious News for Serious Traders! Try StreetInsider.com Premium Free!

You May Also Be Interested In





Related Categories

Credit Ratings, Cryptocurrency, General News, Reuters

Related Entities

Standard & Poor's, Bitcoin