Stablecoin provider Tether has ceased its large-scale Bitcoin mining operations in Uruguay, initially projected as a $500 million investment, due to high energy costs and the absence of a competitive tariff framework.
- Tether laid off 30 of its 38 staff in Uruguay.
- The company confirmed the termination following a meeting with the Ministry of Labor and Social Security.
- Launched in May 2023, the operation was intended to be sustainable, with plans to build three Data Processing Centers and a 300-megawatt wind/solar park.
Despite the half-billion-dollar projection, Tether only spent $100 million and was reportedly cut off by the national electricity provider, UTE, in late July over nearly $5 million in unpaid bills. The company’s failure to secure long-term electricity deals and settle this debt ultimately triggered the shutdown.
In a letter to UTE, Tether stated, “The failure to reach an agreement forces us to rethink our strategy,” emphasizing that a “competitive and predictable tariff framework is essential” for projects of this scale.
The setback raises questions about the viability of energy-intensive mining in high-cost regions, even as Tether aims to control 1% of the global Bitcoin network. The company continues to pursue other mining projects in South America, having previously announced plans for facilities in Paraguay and El Salvador.
