Fitch Rating Agency: El Salvador’s Bitcoin Adoption Will increase Banks’ Regulatory, Financial & Operational Risks
While El Salvador is all role to officially make Bitcoin a upright tender on Sept. 7 and getting ready to airdrop $30 in BTC to its every adult citizen, score agency Fitch says this step come banks face better dangers, including violating suggestions in opposition to money laundering and terrorism financing.
The bitcoin adoption “would elevate monetary institutions’ regulatory, monetary and operational dangers, including the ability of violating world anti-money laundering and terrorist financing requirements,” said Fitch in its document this week.
To pay his bills in El Salvador 🇸🇻, Milton Cabrera says he would have to “spend an hour on the bus, and one other two hours waiting to make the associated rate” in line.
He paid them straight, from his dwelling, with #Bitcoin pic.twitter.com/qT9EczZdnB
— Documenting Bitcoin 📄 (@DocumentingBTC) June 24, 2021
In conserving with Fitch, the likelihood of the utilization of bitcoin for all responsibilities, including bank loans, may possibly well possibly funnel bitcoin traffic thru the Central American nation. This may possibly well well also then elevate the dangers that proceeds from illicit activities toddle thru the nation’s monetary gadget.
Bitcoin’s lack of transparency, Fitch said, may possibly well possibly additional elevate the rise of cash laundering.
The score agency added that rules have to fully agree to the global requirements role by the Financial Action Job Power (FATF).
