Exclusive: The real reason behind Tether's exit from Uruguay is a conflict with an energy giant, not just tariffs.
My analysis of the situation surrounding the closure of Tether's mining division in Uruguay shows that the official version citing "uncompetitive tariffs" is just the tip of the iceberg. The deeper cause lies in a fundamental conflict with the state energy monopoly UTE, which escalated into a legal and operational collapse.
The Essence of the Dispute: Misunderstanding or Deliberate Sabotage?
Having launched Bitcoin mining in 2023 with two sites in the Florida department (total investments — $120 million), Tether faced a problem of contract interpretation. The parties read the terms differently: the USDT issuer considered the agreed volume of electricity a minimum threshold for further scaling, while UTE interpreted it as a hard maximum.
This led to systematic outages lasting up to several days. Moreover, my analysis of documents shows that Tether actually derailed the signing of a new agreement by ignoring a scheduled meeting. The key trigger for escalation was the change in UTE's leadership after President Yamandú Orsi took office in March 2025 — with new directors, dialogue became impossible.
Timeline of the Collapse
By May 2025, the local legal entity Microfin had already stopped paying bills. In June, a notice of contract termination followed, and on July 25, UTE completely cut off power to the facilities. The accumulated debt for electricity and related services was estimated at approximately $4.8 million. The formal closure and staff layoffs occurred only on November 25, indicating a lengthy settlement process.
Strategic Context
Uruguay was supposed to be just a testing ground for large-scale expansion in Brazil, Paraguay, and Argentina. The plans were ambitious: up to $500 million in investments, including three data centers with 165 MW and 300 MW of renewable generation. Notably, even after the Uruguayan fiasco, Paolo Ardoino continues to publicly position Tether as a mining leader, valuing its industry investments at over $2 billion.
My conclusion: This case is a striking example of how political turbulence and bureaucratic inflexibility of state monopolies can destroy even well-funded projects. For Tether, this is a painful but valuable lesson: in Latin America, without political lobbying and clear legal guarantees of energy supply, any mining project is vulnerable. The question remains whether the company will heed this experience when scaling in other countries in the region, where similar risks are no less high.