Tether, the issuer of the world’s largest stablecoin USDT, has halted its Bitcoin mining operations in Uruguay as rising energy costs squeeze the project’s viability. The company confirmed the suspension on Friday, saying it remains committed to long-term plans in Latin America despite the pause.
The move comes weeks after Tether denied reports that it intended to abandon the country following a $4.8 million debt dispute with state-owned electricity provider UTE. However, according to Uruguayan outlet El Observador, Tether formally notified the Ministry of Labour of the shutdown and the dismissal of 30 employees.
Tether’s Uruguay ambitions meet operational roadblocks
Tether started their mining project in Uruguay in May 2023, calling it a “sustainable Bitcoin mining operation” that uses the country’s plentiful renewable energy. The company worked with a local licensed operator whose name is not known, and they said that Uruguay’s clean energy profile was a big plus.
But industry reports later linked Tether’s mining activities to UTE and local commercial operator Microfin. By September, local media reported that the firm had allegedly failed to pay a $2 million electricity bill to UTE, along with an additional $2.8 million owed across other local projects.
Tether denied rumours that it was leaving Uruguay but acknowledged its outstanding debt at the time, saying it was working with the government to resolve the issue.
The company reportedly planned a $500 million investment into Uruguayan mining operations, of which at least $100 million was spent on mining equipment and another $50 million on infrastructure, according to El Observador. Tether has not confirmed these figures.
It remains committed to building long-term initiatives in Latin America, especially projects that harness renewable energy, the best way forward in Uruguay and the region more broadly.