After months of uncertainty, TikTok’s future in the United States finally appears to be taking shape. President Donald Trump signed an executive order approving a “qualified divestiture” that will separate the app from its Chinese parent company, ByteDance, and shift its U.S. operations over a new American-led ownership group, leaving ByteDance with less than a 20 percent stake. This is the president’s most detailed plan yet for TikTok, which faces the threat of a nationwide ban due to national security concerns.
What Is Included in the TikTok Deal?
According to an executive order signed by President Donald Trump, the TikTok deal between the United States and China will see the app’s American assets transition from ByteDance to an American ownership group led by investors. TikTok’s algorithm will also be copied and retrained on U.S. user data to power an American version.
Trump claims Chinese President Xi Jinping has approved the deal, but there are reasons to be skeptical. ByteDance didn't have any representatives present at the signing, and has yet to acknowledge the existence of a deal at all. The Chinese government hasn’t confirmed anything either, and there has been no indication that it plans to make the necessary changes to its laws for the deal to even be possible.
The truth is, much about the TikTok deal remains unclear. But here’s what we know so far.
What We Know About the TikTok Deal So Far
According to Trump’s latest executive order, TikTok’s U.S. operations will be spun into a new American-owned joint venture. The entity will be majority-owned by U.S. investors and must follow strict data security rules.
“It’s owned by Americans, very sophisticated Americans,” Trump said at the executive order’s signing. “This is going to be American operated all the way.”
A new board of directors will be created to oversee the joint venture as well, reportedly with six of seven seats reserved for Americans, including one member selected by the U.S. government. It’s worth noting, however, that the government itself won’t own a stake in TikTok or hold a board seat. The remaining board member will be appointed by ByteDance leadership.
TikTok’s infamously addictive algorithm will also be copied and retrained using only American user data. According to Trump, this process will be overseen by cloud company Oracle, which is already responsible for managing the app’s U.S. user data through Project Texas. The deal will further expand Oracle’s role, tasking the company with storing all TikTok data for U.S. users and completely cutting off ByteDance’s access to this information.
Specifics around exactly how an American-run TikTok algorithm will affect the app’s user experience are sparse, but any changes to come are expected to happen entirely under the hood. While earlier rumors suggested the deal might force U.S. users to migrate to a new app, it now appears that Americans will be able to continue using the same TikTok they already have installed if and when the deal is finalized.
Who Will Control TikTok?
According to statements made by Trump and members of his administration, TikTok’s U.S. operations will fall under an American-led group led by Oracle, global private equity firm Silver Lake and Abu Dhabi-based investment bank MGX — altogether holding a 45 percent stake. ByteDance will retain 19.9 percent, while the remaining 35 percent will go to U.S. ByteDance backers and other investors.
Exactly who those additional investors will be is still up in the air. Major ByteDance stakeholders like General Atlantic, Susquehanna International and Sequoia are expected to participate. Names like media moguls Lachlan Murdoch and Rupert Murdoch, VC firm Andreessen Horowitz and Dell CEO Michael Dell have been thrown around as well.
While the U.S. government will not own a stake in TikTok or hold a board seat, it is expected to collect a multibillion-dollar fee for facilitating this deal.
What’s in it for China?
If the TikTok deal stands as is, ByteDance may end up giving away very little. An American-owned TikTok algorithm will be a mere copy of the original — and it could be a watered-down version that ByteDance provides. This means the effectiveness behind TikTok’s algorithm remains a mystery, and ByteDance maintains its competitive edge. Meanwhile, American users may be stuck with a slower app that produces lower-quality, less tailored content.
ByteDance isn’t giving up the entirety of its stake in TikTok either, keeping a foot firmly in the American social media landscape. As a result, any Chinese tech companies that want to establish a business presence in the United States without revealing any technological secrets now have a blueprint to guide future ventures. Plus, according to Bloomberg, ByteDance will get at least 50 percent of TikTok’s American profits if the deal goes through, despite holding a much smaller portion of it.
The consequences of this deal could reverberate far beyond the tech sector and into the political realm as well. After all, the Chinese government may gauge how it can leverage TikTok to win concessions from Trump on other issues, ranging from more favorable trade deals to the status of Taiwan. If Trump is desperate enough to keep TikTok’s American operations running, he might just give in to China’s demands.
Either way, the limited presence of ByteDance in the U.S. still presents an opportunity for a major Chinese tech firm to continue influencing the American media and business scene — something that’s bound to contribute to national security concerns among Trump administration officials and American politicians.
Why Was TikTok Banned in the First Place?
The push to ban TikTok in the United States stems from concerns over ByteDance sharing it user data with the Chinese government and Chinese Communist Party.
The trouble started back to Trump’s first term. In 2019, then-Senator Marco Rubio submitted a request that the social media app be investigated, claiming that the Chinese government was using it to “advance their foreign policy and globally suppress freedom of speech.” The following year, Trump issued an executive order banning U.S. transactions with ByteDance. He then tried to force ByteDance to sell TikTok to American ownership, but federal rulings stalled those efforts.
Scrutiny only intensified after Trump left office. In 2023, tech investors and American politicians accused the app of harboring “anti-Israel bias,” calling once again for a nationwide ban. Then-President Joe Biden responded by signing the Protecting Americans from Foreign Adversary Act, requiring TikTok to divest from ByteDance or face a U.S. ban. TikTok sued, claiming the law violated its First Amendment rights, but a federal court upheld the law and said TikTok would no longer be usable in the United States after January 19, 2025 unless it was sold.
Things have taken yet another turn in Trump’s second term, as the president has taken a liking to TikTok after it supposedly helped him “win the election in a landslide.” Americans lost access to the app for several hours in January, but Trump signed an executive order shortly after his inauguration extending the deadline for the sale. He’s pushed the deadline back three more times since then. Figures ranging from Elon Musk to MrBeast have expressed an interest in buying TikTok, but ByteDance has never confirmed that it is willing to sell. Plus, the Chinese government would need to approve of any deal, which is a massive complication given ongoing U.S.-China trade tensions.
Now, Trump claims this divestiture adequately satisfies the law, and shields American TikTok users from any “foreign adversary” control.
When Will the TikTok Deal Be Finalized?
As of now, there is no firm deadline for when this deal must be finalized. This latest executive order bars the Department of Justice from penalizing companies for distributing or updating TikTok until January 23, 2026, and states and private parties are barred from attempting enforcement at all.
By pushing the deadline back once again, the White House appears to be buying more time for whatever restructuring or sale needs to take place. No price has been announced, but Vice President JD Vance has reportedly valued TikTok at about $14 billion.
The problem now is that Trump is the only one saying a deal is a sure thing, as neither President Xi Jinping nor the Chinese government have confirmed an approval on their end. Even then, ByteDance’s board of directors must give the green light for any kind of deal to proceed, and it’s uncertain where the company stands on the issue.
So, for now, the clock continues to count down for TikTok in America. Sparing the app from U.S. sanctions may yield short-term benefits, but the bigger question for the Trump administration is whether this deal could jeopardize American business interests and national security at a critical moment in the global tech race.
Frequently Asked Questions
What does the TikTok deal say?
If the deal’s current framework stands, here’s what would change for TikTok:
- TikTok’s U.S. assets will come under the control of an American ownership group, reducing ByteDance’s stake to less than 20 percent.
- A new board of directors will be formed, with six of seven seats reserved for Americans. ByteDance can appoint a member for the remaining seat.
- TikTok’s algorithm will be copied and retrained solely on U.S. user data to power a new American version.
- ByteDance will lose access to all TikTok data collected from users in the U.S., which will be stored and controlled by an American cloud company (probably Oracle).
How does China benefit from a TikTok deal?
ByteDance doesn’t have to hand over its original TikTok algorithm, enabling the company to keep its competitive edge. In addition, the tech firm maintains some stake in TikTok, potentially serving as a blueprint for other Chinese tech companies that want to enter the U.S. market someday. And the Chinese government may even use a possible TikTok deal as leverage to win concessions from President Trump on trade deals and other issues.
When will the TikTok deal take effect?
As of now, there’s no firm timeline on a TikTok deal. Trump has barred the Department of Justice from enforcing the Protecting Americans from Foreign Adversary Act until January, but the deal cannot go ahead until both the Chinese government and ByteDance’s board of directors approves — and neither party has made its stance clear. For now, TikTok’s fate in the United States remains in limbo.
