El Salvador Bitcoin adoption possesses ‘immediate negative implications,’ credit rating agency says: Report


S&P Global said that the risks of the country’s decision to make bitcoin legal tender outweighed its potential benefits.

The credit rating agency S&P Global said El Salvador’s decision to adopt bitcoin as legal tender had “immediate, negative implications,” according to a Reuters article on Thursday.

  • S&P said that bitcoin adoption could deter El Salvador from participating in an International Monetary Fund support program, increase financial weaknesses and impair banks by generating currency mismatches when they look to loan money, Reuters said.

  • “The risks” of El Salvador’s bitcoin adoption “seem to outweigh its potential benefits,” S&P said, according to Reuters. “There are immediate negative implications for (the) credit.”

  • The agency has given El Salvador a B- rating and a “stable” outlook.

  • Bitcoin became legal tender in El Salvador on Sept. 7 to great fanfare but has continued to spur protests among critics who say the law is not constitutional. The law was passed by a supermajority in El Salvador’s legislature on June 9.

  • In July, the ratings agency Moody’s downgraded El Salvador’s long-term, foreign-currency issuer and senior unsecured ratings from B3 to Caa1 and continued a negative view of the country’s economy partly because of the government’s passage of the bitcoin law.

All writers’ opinions are their own and do not constitute financial advice in any way whatsoever. Nothing published by CoinDesk constitutes an investment recommendation, nor should any data or Content published by CoinDesk be relied upon for any investment activities. CoinDesk strongly recommends that you perform your own independent research and/or speak with a qualified investment professional before making any financial decisions.

Cryptos feed

Latest Crypto News


Latest Crypto News & Analysis

Editors’ Picks

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Crypto bulls on winning streak pushing for more

Bitcoin price jumped this week after a shift in sentiment on Thursday when global equities went back in the green and investors favored riskier assets like cryptocurrencies. 

More Bitcoin News

Binance support for Polkadot parachain auctions could send DOT to new all-time high

At the Sub0 Conference representatives of Parity Technologies, DOT founders Gavin Wood and Robert Habermeier, confirmed that Polkadot is now ready to implement parachains, auctions and crowd loans on its blockchain network. 

More Polkadot News

XRP price awaits for volume to skyrocket to $2

A brief technical and on-chain analysis on XRP price. Here, FXStreet's analysts evaluate how Ripple bulls take control.

More Ripple News

Shiba Inu whales buy the dip after SHIB loses $600 million in market cap

Shiba Inu concluded a massive rally, and SHIB price plunged on October 14. Proponents were awaiting a Dogecoin flippening, however, SHIB dropped to 14th rank by market capitalization soon after. 

More Shiba Inu News

BEST CRYPTO BROKERS/EXCHANGES




Bitcoin Weekly Forecast: Markets revert to mean, but BTC price remains indecisive

Bitcoin price shows considerable strength after springing from the recent crashes. Still, it is uncertain whether the current bullish impulse will morph into a new uptrend or lead to a more profound decline.

Read the weekly forecast

BTC

ETH

XRP