TLDR
- Tether abandoned two Uruguay Bitcoin mining sites after a prolonged electricity dispute with state utility UTE.
- A former contractor estimated Tether invested roughly $120 million across the two Bitcoin mining facilities.
- Tether and UTE disagreed over whether contracted electricity represented a minimum allocation or maximum limit.
- UTE disconnected power in July 2025 after revised contract talks failed and bills remained unpaid.
- Tether later ended operations, laid off most local employees and settled Microfin’s outstanding electricity debts.
Tether has abandoned two Bitcoin mining sites in Uruguay after a dispute over electricity supply disrupted operations, ending a project that had drawn about $120 million in estimated investment.
Power Dispute Forces Tether to Exit Uruguay
Tether entered Uruguay in 2023 with plans to build two Bitcoin mining sites in the department of Florida. The company viewed the country’s renewable power mix and stable grid as a base for wider expansion across South America.
A former contractor estimated that Tether spent about $60 million on each site, or roughly $120 million in total. Early operations generated revenue, but problems emerged as the mining facilities required more electricity than Tether believed it could access under its contract with state utility UTE.
The dispute centered on how both sides interpreted the agreed power allocation. Tether treated the figure as a minimum that could later increase, while UTE viewed it as the maximum amount available under the contract.
As demand rose, the facilities sometimes lacked enough power to operate for days. That disruption put pressure on a business model that depends on large numbers of mining machines running almost continuously.
Microfin Stops Payments and Ends Contracts
The disagreement was already active by November 2024. Negotiations became more difficult after a change in Uruguay’s government in March 2025 and the appointment of new directors at UTE.
Microfin, Tether’s local entity, stopped paying electricity bills two months later and informed UTE in June that it planned to terminate its contracts. The two sides still tried to reach revised terms, and UTE’s board approved updated documents.
However, Tether representatives did not attend the planned signing. UTE later disconnected power to the sites on July 25 after the agreement remained unsigned and bills were still outstanding.
Tether subsequently informed Uruguay’s labor authorities that it would stop operations and laid off most employees. Microfin later settled its unpaid electricity balance in December.
Mining Economics Remain Tied to Power Costs
The Uruguay exit came during a tougher period for Bitcoin miners. The April 2024 halving reduced block rewards, while electricity, equipment and infrastructure expenses remained high.
Uruguay’s power system relies heavily on renewable energy, but large-scale mining still faces relatively high electricity costs. Mining specialist Nicolas Ribeiro said, “Uruguay isn’t viable for mining that’s the reality.”
The setback has not ended Tether’s broader mining strategy. The company has said it invested more than $2 billion in energy production and Bitcoin mining globally.
Tether also continues to support mining activity elsewhere in Latin America, including Brazil, where it has worked with renewable energy producer Adecoagro. The company has also released open-source mining software and retained a stake in Bitdeer.
The failed Uruguay project shows how industrial Bitcoin mining depends on more than access to capital. Reliable power, contract terms and electricity pricing can determine whether large mining sites remain commercially viable.
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