Tether’s attempt to build a $120 million Bitcoin mining foothold in Uruguay has collapsed after a power contract dispute with state-owned utility UTE, according to documents and interviews reviewed by Reuters. The two mining sites, located in Uruguay’s Florida department, were disconnected from electricity on July 25, 2025, after Tether’s local entity Microfin stopped paying its power bills. The facilities were intended to be a launchpad for broader South American expansion into Brazil, Paraguay, and Argentina.
The dispute centered on how much electricity the sites could draw. Tether interpreted the contracted power figure as a minimum allocation that could eventually be expanded, while UTE considered it the maximum available supply for Microfin. As the mines scaled, insufficient supply reportedly left the facilities without enough electricity for days. UTE and Tether attempted to renegotiate, and the utility’s board approved a memorandum of understanding and revised contract documents, but Tether representatives did not attend the planned signing. By June 2025, Microfin had informed UTE it intended to terminate the contracts; UTE cut power the following month. Microfin later settled its outstanding debt in December.
The collapse highlights how electricity access and cost remain decisive for industrial Bitcoin mining, especially after the April 2024 halving reduced the block subsidy from 6.25 BTC to 3.125 BTC. Uruguay offered political stability and renewable generation, but relatively high power costs made it less competitive for mining, according to crypto mining specialist Nicolas Ribeiro. Tether has already shifted focus toward Brazil. In July 2025, Tether and renewable-energy producer Adecoagro signed a memorandum of understanding to explore using surplus renewable electricity for Bitcoin mining. Tether had previously acquired a controlling stake in Adecoagro, giving it more direct control over underlying energy assets.
CEO Paolo Ardoino said in June 2025 that Tether had invested more than $2 billion in energy and mining infrastructure across 15 sites in Uruguay, Paraguay and El Salvador. The Uruguay exit leaves the company with a more fragmented regional strategy and serves as a cautionary example for institutional miners: reliable renewable capacity is not enough without long-term contractual certainty over price and consumption limits.
