Energy expenses and outstanding debts compel Tether to withdraw from its $500 million mining project in Uruguay
- Tether halted Uruguay Bitcoin mining due to rising energy costs and $4.8M debt with UTE. - The $500M project ended with 30 layoffs after $150M spent on mining/infrastructure. - Uncompetitive energy tariffs and lack of long-term contracts caused the venture's collapse. - The exit highlights crypto mining's vulnerability to volatile energy markets and regulatory gaps. - Tether remains focused on Latin American renewables but no Uruguay restart timeline exists.
Tether Halts Bitcoin Mining in Uruguay Amid Rising Energy Costs
Tether, the company behind the world's leading stablecoin USDT, has decided to suspend its Bitcoin mining activities in Uruguay. This move comes as a result of soaring energy prices and unresolved financial issues with the country's state-run utility providers.
The company confirmed to Cointelegraph that it has paused operations, citing unsustainable electricity expenses and ongoing talks with Uruguayan officials to address an outstanding $4.8 million debt related to unpaid power bills and other local commitments. As part of this decision, Tether has let go of 30 employees, effectively ending a $500 million investment plan launched in May 2023 that aimed to make Uruguay a center for environmentally friendly crypto mining powered by renewable energy.
Challenges for Sustainable Crypto Mining
Although the project was initially promoted as a benchmark for green Bitcoin mining, it quickly encountered difficulties. According to local sources, Tether invested at least $100 million in mining operations and another $50 million in infrastructure before halting further spending. The dispute with Uruguay's National Administration of Power Plants and Electric Transmissions (UTE) escalated in September 2024, when speculation about Tether's potential exit first surfaced in the media. While Tether denied any intention to withdraw at that time, the company did acknowledge the debt and said it was working toward a resolution.
Over the past year, Uruguay has experienced a significant increase in energy costs, making it difficult for energy-intensive industries like cryptocurrency mining to remain profitable. Tether’s initial enthusiasm for Uruguay’s renewable energy resources was dampened by high electricity rates and mounting operational expenses. The company attempted to renegotiate its power agreements, including a request to switch to higher voltage tariffs, but no agreement was reached. Industry experts believe that the absence of long-term energy contracts and regulatory certainty contributed to the project's downfall.
Industry Impact and Future Outlook
Tether’s withdrawal has broader consequences for the cryptocurrency mining sector. The situation highlights the vulnerability of large-scale mining projects in areas with unstable energy markets. Analysts note that stable electricity pricing and clear regulatory policies are essential for the success of such ventures. Tether’s experience may prompt other companies to be more cautious when considering similar investments, especially in regions where energy costs are unpredictable.
Despite this setback, Tether has reiterated its commitment to Latin America and continues to explore renewable energy opportunities throughout the region. A company spokesperson emphasized their focus on “long-term initiatives that harness renewable energy,” although no timeline has been set for resuming operations in Uruguay. The company’s next steps will likely depend on resolving the current debt dispute and securing more favorable energy terms.
The Uruguayan government has not yet officially responded to Tether’s exit. However, the situation has sparked discussions about the challenges of attracting foreign investment in sectors that require substantial energy resources. For now, Tether’s experience serves as a warning for crypto companies seeking to balance ambitious growth with the realities of energy economics.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Zcash News Today: Crypto’s Schism: Doubt in L1s Contrasted with Growth at the Application Layer
- QwQiao critiques speculative L1 tokens (e.g., Bitcoin , Ethereum) for scalability issues and volatile valuations, contrasting them with utility-driven application-layer innovations. - Application-layer projects like DeFi, NFTs, and privacy-focused Zcash (ZEC) gain traction via real-world use cases, exemplified by Grayscale's ZEC ETF and Bitcoin Munari's structured token sales. - Dynamic tokenomics and institutional adoption (e.g., Ripple's RLUSD approval) highlight shifting priorities toward sustainable

Solana News Today: GeeFi's Presale Skyrockets Amid 2025 AI Surge, Attracting Investors with Promises of 3,000% Returns
- GeeFi's (GEE) Phase 2 presale surges with 10M tokens sold, offering 3,000% ROI forecasts vs. struggling Layer-1 rivals like Avalanche and Solana . - GEE's 20% phase-based pricing model (currently $0.06) targets $0.40 listing, with experts projecting 4,900% returns if it reaches $3/token. - The project's non-custodial wallet, DEX, and 55% APY staking, plus VISA/Mastercard crypto card partnerships, differentiate it from speculative crypto peers. - Market shifts toward utility-driven solutions accelerate as

Bitcoin Updates: Bitcoin’s Financial Infrastructure Sets the Stage for an ETF-Fueled Bull Market
- BlackRock deposited $422M in BTC/ETH to Coinbase Prime, signaling institutional-driven Bitcoin liquidity growth and ETF adoption. - Nasdaq's 40x IBIT options expansion is seen as structural catalyst for institutional capital deployment and Bitcoin's all-time high potential. - Mixed on-chain metrics show $90k retest but weak liquidity above $84k, with weekend volatility and short-covering limiting sustained bullish momentum. - Market awaits confirmation of BlackRock's $85.3k support hold and Fed rate deci

Solana News Update: Institutional Interest Drives Solana ETFs Higher, While Token Value Declines
- CoinShares withdrew its staked SOL ETF application due to uncompleted structuring deals, complicating crypto ETF development in the U.S. - Competitors like Bitwise and Franklin Templeton launched successful staked SOL ETFs, amassing $918M in assets despite SOL's price stagnation below $150. - ETF inflows contrast with SOL's weak price action, hindered by technical issues and a bearish death cross pattern near $130 support level. - Institutional confidence persists through accumulation, but macroeconomic
