Blame the Bitcoin Bond? El Salvador’s Dollar-Denominated Debt Slides

Blame the Bitcoin Bond? El Salvador’s Dollar-Denominated Debt Slides
El Salvador’s dollar-denominated debt has taken a beating in recent weeks, with observers blaming President Bukele’s plan to issue bitcoin bonds for the sell-off. But there’s more to the decline than meets the eye.“Salvador’s bond spreads to comparable U.S. treasuries have widened, and the bitcoin bonds are a contributing factor, but certainly not the only one,” Marc Ostwald, chief economist at London-based ADM Investors Services International, said in an email. “There has been a sharp widening of spreads between the emerging market bond yields and Treasury yields in the past two weeks and an uptick in yields on investment-grade and…