Tether has abandoned its Bitcoin mining operation in Uruguay, walking away from two facilities estimated to have cost $120 million following a prolonged dispute with state utility UTE over available power capacity.
According to former contractors and a UTE source cited by Reuters, the disagreement centered on unclear contract clauses. Tether's local operator, Microfin, and the utility failed to agree on electricity allocations. Tether reportedly interpreted a figure in its supply contract as a minimum to scale from, while UTE viewed the same figure as a hard maximum.
The disagreement escalated as the mining sites grew in size and productivity, leading to stretches where the mines lacked sufficient power to operate. An internal UTE briefing indicated the two sides were at odds by November 2024.
Following the inauguration of Uruguay's new administration in March 2025 and the installation of fresh directors at UTE, the utility became less inclined to renegotiate the agreement. Microfin stopped paying electricity bills by May 2025 and notified UTE in June of its intent to terminate the contracts.
An attempted memorandum of understanding ultimately failed when Tether representatives did not attend the scheduled signing. With approximately $5 million in unpaid bills, UTE cut power to both sites in July 2025. Microfin subsequently cleared the debt in December, according to the utility.
Tether originally unveiled the operation in May 2023, praising Uruguay's renewable power and dependable grid as an initial testing ground for regional expansion. Despite abandoning the Uruguay project, Tether pursued other regional ventures, striking a deal in July 2025 with agricultural producer Adecoagro to mine Bitcoin using renewable energy in Brazil.
