Tether’s expansion into Bitcoin mining in Uruguay has run into a major setback after the state-owned electricity provider UTE suspended service to the stablecoin operator’s two mining facilities over unpaid bills of roughly $5 million. The disruption, confirmed on July 25, 2025, comes only two years after Tether unveiled the Bitcoin mining project in the South American nation, citing a rich supply of renewable energy sources.
According to local media Busqueda, the payment defaults by Tether began in May 2025. By June, UTE’s president, Andrea Cabrera, signed a Memorandum of Understanding (MoU) with Microfin, the local operator tied to the mining project, in an effort to negotiate a settlement. However, after arrears continued to mount, UTE invoked standard procedures, using security deposits before suspending power supply at the mining sites in Flores and Florida on July 25.
The power cut produces immediate operational consequences, compromising the facilities’ computing nodes and reducing hash rate output, while slowing down general expansion goals. Meanwhile, restarting the sites will also incur additional costs, from renegotiating contracts to restoring technical capacity. And even such processes often require weeks, depending on the guarantees offered and compliance with regulatory protocols. Tether entered Uruguay in 2023 with plans to leverage the country’s renewable energy profile through its “Tether Energy” initiative. Uruguay generates approximately 95% of its electricity from non-fossil sources, making it one of the most attractive jurisdictions globally for “low-carbon” industrial activity. The project was positioned as a step toward diversifying Tether’s business model beyond stablecoin issuance, with ambitions to eventually secure 1% of Bitcoin’s global hash rate. Back in 2023, the company’s CTO, Paolo Ardoino, said about the project:
By harnessing the power of Bitcoin and Uruguay’s renewable energy capabilities, Tether is leading the way in sustainable and responsible Bitcoin mining; Our unwavering commitment to renewable energy ensures that every Bitcoin we mine leaves a minimal ecological footprint while upholding the security and integrity of the Bitcoin network. Tether is proud to spearhead a movement that combines cutting-edge technology, sustainable practices, and financial innovation
Following the recent revelations by the Uruguayan media, neither Tether nor Microfin has yet to reveal their official position.
In other news, Tether’s stablecoin USDT has attained a new market cap value of $171.5 billion, strengthening its dominant market position. Presently, USDT now accounts for 58.9% of the stablecoins market while remaining the fourth largest cryptocurrency in the world.
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