- Tether has stopped all its operations in Uruguay due to the worsening situation over the past months.
- The exit was mainly due to the high prices of energy and inflexible tariffs.
- The company laid off thirty workers, while over a hundred million USD was already in the pipeline.
Tether had ambitious plans coupled with a robust faith in the country when it moved to Uruguay. It assured the world of its capacity, a great future, and strong winds along with noiseless machines.
However, last Tuesday, at the National Directorate of Labour’s offices, Tether’s bright future was shattered. The company informed the Ministry of Labor and Social Security of its decision to terminate all operations in Uruguay. Consequently, it laid off 30 of the total 38 employees. The announcement came down hard, like a door shutting at the end of a long passage.
Tether’s Withdrawal Sets a Stark New Course
Tether had been one of the biggest corporations that entered the flourishing digital asset market of Uruguay. Their plans, which were initially declared with great certainty, covered many sectors and aimed at energizing the country’s economic scenario. However, Tether mentioned that the actual situation had drained their finances heavily.
The company’s departure was already rumoured in September. There were news articles that the huge cost of energy was cutting into the company’s dreams. The size of Tether’s investment was no longer viable without a proper tariff system. Tether had requested a modification. It had been patiently waiting for one. However, none showed up.
Also Read: Tether’s 116-Ton Gold Reserve Tightens Global Market Supply
Tether’s Investment Dreams Meet Hard Ground
The figures presented a narrative of aspiration and heaviness. Tether was expecting to get investments of USD 500 million. Florida and Tacuarembo would each have one of the three Data Processing Centres.
A combined wind and solar power generation of 300 MW was planned. A demand footprint of 165 MW was going to be established. Over USD 100 million had already been executed. USD 50 million more was allocated to the infrastructure that would be transferred to UTE and the National Interconnected System.
Yet, when reality changes, dreams become expensive. The company claimed that the present situation rendered it impossible to continue. The contractual arrangement along with the 31.5 kV tariffs enforced in Florida were very detrimental to its business. Each month added a greater burden.
From the beginning of November 2023, Tether had been advocating for a tariff structure befitting its size. It made a request to transfer to a 150 kV toll system. It made a request to alter the power purchase agreement. It put forward options that, according to its view, would be advantageous for UTE and would not cause unnecessary construction. None of it reached the man. Thus, the firm retreated.
Eventually, the quietness around the choice was as informative as the choice itself. The firm did not leave Uruguay due to a hasty decision but rather because they saw it as an inevitable outcome. The wind continues to blow in the rural areas where the turbines are located. However, the rooms which were supposed to be filled with the sound of the new machines will be silent for now.
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