Tether's Uruguay Bitcoin Mining Project Derailed by Electricity Dispute

Tether's ambitious Bitcoin mining project in Uruguay has run into trouble due to a dispute over electricity access. The stablecoin issuer invested an estimated $120 million in the venture, which aimed to take advantage of the country's renewable energy supply and favorable tax treatment.

The disagreement between Tether and state-owned utility Administración Nacional de Usinas y Trasmisiones Eléctricas (UTE) centered on the interpretation of a power contract clause. Tether believed that the contract guaranteed a minimum electricity allocation, while UTE treated it as a maximum limit.

The dispute escalated after Uruguay's leftist government took office in March 2025 and installed new UTE leadership, which took a firmer stance on renegotiation requests. Microfin, the local entity operating the facilities, stopped paying its electricity bills in May 2025, and by June it had notified UTE of its intent to terminate the contract.

With unpaid power bills and an unsigned memorandum of understanding, UTE cut off power to the sites on July 25, 2025. Tether eventually informed Uruguay's labor authorities that it would halt operations and lay off most staff in November 2025.