Tether Abandons $500M Uruguay Data‑Center Plan, Lays Off 30 Staff
Tether Holdings has ended its Uruguay operations and cancelled a planned $500 million data‑center and renewable energy project after failing to secure commercially viable power terms. The project comprised three data centres in Florida and Tacuarembó (estimated 165 MW load) and a 300 MW wind/solar park. More than $100 million had already been spent and roughly $50 million in infrastructure costs remained payable to Uruguay’s state utility UTE. Tether said transmission and operating costs — notably an upgrade tied to a 31.5 kV transmission model in the Florida department and disputed transmission pricing since November 2023 — made the scheme uneconomic. The company proposed alternatives, including switching to a 150 kV transmission fee structure and amending power‑purchase terms, but negotiations failed. As a result Tether will halt local operations and lay off 30 of 38 employees. For crypto traders: the move reduces Tether’s operational footprint and halts a major regional energy‑intensive project, with limited direct effect on Tether-issued stablecoins but potential secondary impacts on regional mining/data‑center capacity and local market sentiment toward crypto infrastructure investment.
Neutral
Direct price impact on Tether-issued stablecoins (e.g., USDT) is likely minimal because the announcement concerns infrastructure investment and operations rather than the peg, reserves, or monetary policy. Tether halting a $500M project reduces its operational and capital exposure, which could be viewed as prudent risk management. Short-term: traders may see minor volatility in market sentiment or regional crypto equities linked to mining/data centers, but no clear downward pressure on USDT value. Long-term: the cancellation signals potential obstacles for large crypto firms seeking favourable local energy deals; this could modestly dampen expectations for further company-led infrastructure expansion in Latin America, affecting investment flows into crypto mining and hosting services. Overall, the news is notable for infrastructure and sector sentiment rather than for immediate price moves in Tether’s stablecoin.