Tether Abandons $120M Bitcoin Mining Project in Uruguay Amidst Dispute

Tether's ambitious plan to build two Bitcoin mining sites in Uruguay has been dealt a major blow after a dispute with state-owned utility UTE over electricity allocation.

The stablecoin issuer had invested around $120 million in the project, which was initially envisioned as a stepping stone for larger South American markets, including Brazil and Argentina. However, the disagreement centered on interpretation of a key clause in the power supply contract.

A former contractor estimated that Tether read the contracted electricity figure as a minimum baseline, while UTE treated it as a maximum allocation. The dispute escalated after Uruguay's leftist government took office in March 2025 and installed new UTE leadership, which took a firmer stance on Tether's renegotiation requests.

The two sites reportedly went days without sufficient power, leading to unpaid electricity bills and ultimately the decision to cut off power by UTE. By November 2025, Tether informed Uruguay's labor authorities that it would halt operations and lay off most staff, marking the end of its Bitcoin mining venture in Uruguay.