Tether Shuts Down Uruguay Mining Operations Amid Energy Dispute

Tether, the world’s largest stablecoin issuer, has confirmed it is shutting down its bitcoin mining operations in Uruguay after failing to secure a favorable agreement with government authorities over energy tariffs. The company’s withdrawal marks a major setback for its ambitions in South America, where it had planned significant long-term investments tied to renewable energy and sustainable crypto mining.

According to reports from Uruguay’s Ministry of Labor, Tether reaffirmed its decision during a meeting with the National Directorate of Labor. As part of the shutdown, 30 of its 38 employees in the country will be laid off as operations wind down. The decision effectively ends what was once positioned as a major push into sustainable bitcoin mining in Uruguay.

Tether had previously outlined plans to invest as much as $500 million in the country, aiming to build three advanced data centers and a 300-megawatt renewable energy park. Since entering the market in 2023, the company says it has already spent more than $100 million and committed an additional $50 million to infrastructure that would have eventually supported Uruguay’s national grid operator, UTE.

However, rising energy costs and regulatory hurdles ultimately derailed the initiative. Local media reports indicate that Tether had been pushing for a shift to a more competitive electricity pricing structure. Specifically, it sought to move from the existing 31.5 kV transmission rate to a 150 kV tariff, arguing the change would reduce costs for both the company and the country, while helping to avoid unnecessary infrastructure expansion.

Despite these proposals, negotiations stalled, leading Tether to conclude that continuing operations was no longer feasible. The shutdown highlights the challenges crypto mining firms face when navigating energy-intensive operations in markets with evolving regulatory frameworks.