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In a major blow to its ambitious Latin American plans, Tether has officially confirmed it is exiting its Bitcoin mining operations in Uruguay, citing unsustainable energy costs and failed negotiations over electricity tariffs. The decision effectively ends a project that once proposed nearly US$500 million in investment and underlined the difficulty of large-scale crypto mining ventures in regions with unstable energy economics.
Tether’s Uruguay venture had been ambitious. Launched in 2023, the project included plans to build multiple data centers and even a 300-megawatt renewable energy park, leveraging Uruguay’s reputation for clean power.
The idea was to create a “sustainable mining hub,” combining renewable energy infrastructure with modern mining operations.
However, the project soured when Uruguay’s state utility, UTE, refused to offer a competitive tariff framework. The energy tariffs, coupled with rising costs and an unfavorable transmission contract (31.5 kV instead of a lower-cost 150 kV), rendered mining economically unviable. Tether reportedly spent over US$100 million before halting further investments.
By mid-2025, tensions had escalated. Two of Tether’s mining facilities had their power disconnected by UTE after unpaid electricity bills reportedly reached nearly US$5 million. Efforts to renegotiate terms, including changes to transmission agreements, failed to yield viable solutions.
On November 27, 2025, Tether formally informed Uruguay’s Ministry of Labor and Social Security that it would cease operations in the country. As a result, 30 of the 38 employees at its Uruguay operation were laid off.
Why This Exit Matters
Tether’s shutdown sends a clear signal to the global crypto mining community: profitability for energy-intensive mining depends heavily on predictable and cheap electricity. Volatile energy prices, unfavorable tariffs, or regulatory misalignment can quickly derail even the most well-funded projects.
The move effectively ends what had been one of the most high-profile attempts to build a large-scale “clean energy” mining hub in South America. Many in the industry had looked to Uruguay’s renewable-energy mix largely wind and hydro as a blueprint for sustainable mining. But without stable and affordable power pricing, the math simply didn’t work.
For miners and crypto firms eyeing Latin America, Tether’s withdrawal may increase scrutiny of energy costs, transmission arrangements, and tariff stability. Investors are likely to demand more rigorous feasibility studies, long-term power contracts, or alternative energy arrangements before committing.
In announcing the exit, Tether emphasized that its decision was not taken lightly. A company spokesperson reportedly said that while Uruguay has long held “significant potential,” large-scale mining projects necessitate “predictable and competitive electricity tariffs.” With that clarity missing, continuing operations would simply be unsustainable.
What’s Next for Tether
While this marks the end of the Uruguay mining chapter, Tether indicated that it is evaluating alternative opportunities in other jurisdictions with more stable energy economics. Analysts believe the firm may redirect focus toward regions offering lower-cost power or better regulatory certainty essential conditions for profitable crypto mining today.
FAQs
1. Why did Tether shut down its Bitcoin mining operations in Uruguay?
Tether cited unsustainably high electricity costs and a lack of competitive energy tariffs after failed negotiations with Uruguay’s state utility.
2. How much had Tether invested in the Uruguay project?
Though it planned up to US$500 million in total investment, Tether reportedly spent just over US$100 million before pulling the plug.
3. What happened to the staff working in Uruguay?
Tether laid off 30 of the 38 employees at its Uruguay operations after formally notifying authorities of the shutdown.
4. Could Tether restart mining in Uruguay under different conditions?
While possible, restart would require a competitive and predictable tariff structure. As of now, no agreement has been reached to that effect.
5. What does this mean for the broader crypto mining industry?
The exit highlights the critical importance of energy pricing and regulatory clarity for profitable mining. Other firms may now re-evaluate or delay similar projects in regions with unstable energy economics.