Tether’s bitcoin mining operations in Uruguay, valued at roughly $120 million, were terminated in mid-2025 following a dispute with state utility UTE over electricity supply terms. The company’s local entity, Microfin, had invested approximately $60 million in each of two mining sites in the department of Florida, according to company filings and internal documents reviewed by Reuters.
The project, announced in May 2023, was positioned as a strategic expansion into South America, leveraging Uruguay’s renewable energy capacity and stable grid. Tether had promoted the initiative as part of a broader $2 billion global investment in energy production and bitcoin mining, positioning itself as a major player in the sector. At the time, the company controlled around $183 billion in stablecoin issuance, underscoring its financial scale.
The collapse followed a breakdown in negotiations over power supply agreements. Tether’s Microfin unit contended that a contract clause with UTE represented a minimum guaranteed power allocation that could later be increased. UTE, however, interpreted the clause as a maximum limit that could not be exceeded, according to internal briefings and statements from both parties. The disagreement intensified after Uruguay’s left-leaning government took office in March 2025 and appointed new directors at UTE, who adopted a stricter stance on contract enforcement.
Microfin ceased power bill payments in April 2025, two months before UTE disconnected electricity to the mining sites on July 25, 2025. By November 25, 2025, Tether informed Uruguayan labor authorities that it would cease operations and lay off most staff, as reported by local media outlet El Observador. The company later settled its outstanding debts with UTE in December 2025, according to utility records.
Analysts noted that Uruguay’s relatively high electricity costs and the mobile nature of bitcoin mining infrastructure made relocation a plausible alternative for Tether. Pete Howson, an assistant professor at Northumbria University, described mining operations as "hypermobile," emphasizing that such projects rarely create long-term economic benefits for host countries. Nicolas Ribeiro, a crypto mining expert, added that Uruguay’s grid and internet infrastructure were better suited for industries such as AI data centers, where power costs are less critical than in energy-intensive mining operations.
