Tether’s $120 Million Uruguay Bitcoin Mining Project Collapsed Over a Power Contract Dispute

Tether walked away from an estimated $120 million bitcoin mining buildout in Uruguay after the state utility cut power to its sites over a contract dispute, The Block reported, citing Reuters.

At issue: how much electricity the two mining sites in Uruguay’s Florida department could draw. Tether read the contracted amount as a floor it could raise later. UTE, the state-owned utility, read it as a ceiling. The two sides moved toward a revised contract. Then Tether representatives failed to appear for the signing, according to meeting notes obtained by Reuters.

UTE cut power on July 25, 2025. About five months passed. On Nov. 25, Tether notified Uruguay’s labor authorities that it would end operations and lay off most of its staff.

A source with knowledge of the deal estimated the company spent around $120 million on the project. Tether never publicly disclosed the figure.

The sites ran well at first. They generated income, two former contractors told Reuters. As electricity demand climbed, the operation sometimes went days without enough power.

The unraveling tracked a change in government. Yamandú Orsi took office in March 2025 and later appointed new directors to UTE. The new leadership took a harder line on contract negotiations, according to a former contractor and another source. Tether’s Uruguayan legal entity, Microfin, stopped paying electricity bills two months after the transition. It told UTE in June 2025 that it intended to terminate its contracts.

The timing proved awkward. CEO Paolo Ardoino told The Block’s Big Brain podcast in June 2025 that Tether would become the “biggest bitcoin miner out there” by the end of the year. At that point the company said it had invested more than $2 billion in energy and mining infrastructure across 15 sites in Uruguay, Paraguay, and El Salvador. One month later, UTE disconnected the two Uruguay sites.

A former contractor described Uruguay to Reuters as a “first step” and a testing ground before Tether expanded into Brazil, Paraguay, and Argentina. Nicolas Ribeiro, a crypto mining specialist, was blunter. “Uruguay isn’t viable for mining,” he told Reuters. The industry is “extremely dynamic,” he added, with operators frequently opening, closing, or relocating sites.

Tether announced its Uruguay operation in May 2023, calling the country the “perfect platform” for its renewable electricity and established grid.

The company has kept spending elsewhere in the region. It acquired a 70% stake in renewable energy producer Adecoagro and later signed an agreement to use the company’s surplus electricity for mining. It released an open-source mining operating system in February 2026. In April, it took an 8.2% stake in mining finance firm Antalpha and began developing modular mining systems with Canaan and ACME Swisstech.

Tether’s USDT stablecoin has around $183 billion in circulation, per Reuters. The El Salvador-based company employs a few hundred people and values its investment portfolio at about $20 billion. Most of its more than 100 investments have not been publicly disclosed.

Tether did not respond to requests for comment from either Reuters or The Block. The fate of the mining hardware at the two Florida department sites is not stated in the reporting.