Key Takeaways
- Tether abandoned $120M in Bitcoin mining sites in Uruguay after a power dispute.
- The company later paid about $8.19M to settle electricity obligations.
- Tether still has $2B+ invested in mining and energy infrastructure globally.
Tether’s push to become a major Bitcoin miner has suffered a costly setback in Uruguay, where an estimated $120 million investment across two mining sites was abandoned after a prolonged dispute over electricity supply.
Reuters reported that Tether spent roughly $60 million on each facility in Uruguay’s Florida department. The project, launched in 2023, was intended as a testing ground before a broader expansion into Brazil, Paraguay, and Argentina. Tether never publicly disclosed the $120 million figure and did not respond to Reuters’ requests for comment.
Power Contract Dispute Shut Down Both Sites
The central dispute involved how much electricity Tether’s local entity, Microfin, was entitled to receive from state-owned utility UTE.
Tether reportedly interpreted the contracted electricity allocation as a minimum that could later be increased. UTE viewed the same figure as a maximum allocation.
That became a serious constraint as the facilities expanded. Former contractors told Reuters that the sites initially operated successfully and generated income, but later experienced periods without sufficient power for days at a time. The disagreement had emerged by November 2024.
Attempts to renegotiate eventually failed. Microfin stopped paying electricity bills in 2025 and informed UTE in June that it planned to terminate the contracts. Although UTE approved revised terms, Tether representatives did not attend the signing, according to internal records reviewed by Reuters.
UTE disconnected the two facilities on July 25, 2025. Local reporting initially put the unpaid balance at nearly $5 million. By December, Tether agreed to pay UTE approximately $8.19 million to settle outstanding obligations and end the commercial relationship.
Tether notified Uruguay’s labor authorities in November that it would cease operations and dismiss most employees.
Uruguay Looked Ideal Until Electricity Economics Intervened
Tether originally chose Uruguay because of its unusually clean electricity system. When announcing the project in May 2023, the company said roughly 94% of the country’s electricity came from renewable sources, describing its grid as a strong foundation for sustainable Bitcoin mining.
That share has since climbed further. UTE says 98% of Uruguay’s electricity generation was renewable in 2025.
But abundant renewable power does not necessarily mean cheap power. Crypto mining specialist Nicolas Ribeiro told Reuters that Uruguay’s electricity costs make mining difficult economically, despite the reliability of its grid.
Tether Has Not Abandoned Bitcoin Mining
The Uruguay collapse does not mark a wider retreat.
By mid-2025, Tether said it had invested more than $2 billion across 15 energy and mining sites in Uruguay, Paraguay, and El Salvador. CEO Paolo Ardoino even said Tether expected to become the world’s largest Bitcoin miner.
Tether has since expanded into Brazil through renewable-energy producer Adecoagro, which has more than 230 MW of generation capacity across South America.
Uruguay instead offers a warning about the economics behind that ambition: access to renewable electricity alone is insufficient if miners cannot secure enough power at predictable prices.
