The White House announced Monday that U.S. and Chinese officials have reached a preliminary agreement allowing TikTok to continue operating in the United States. According to Scott Bessent, Secretary of the U.S. Department of the Treasury, the deal creates a “framework” that addresses U.S. national security concerns while giving ByteDance, TikTok’s Chinese parent company, a fair business environment to operate in.
New U.S.-Based Entity and Ownership Structure
Under the plan, TikTok’s U.S. assets will be separated from ByteDance and placed under a new U.S.-based company. The platform’s recommendation algorithm and other intellectual property will be licensed to this new entity. It will be controlled by a consortium including Oracle, Silver Lake and Andreessen Horowitz.
American investors would hold about 80 percent ownership, while Chinese stakeholders would retain around 20 percent, and the board would be mostly composed of U.S. members, including one appointed by the United States government.
Unresolved Details and Security Safeguards
Bessent declined to share the full terms of the arrangement, but emphasized that protecting U.S. national security is the administration’s top priority. How the algorithm will be governed remains one of the most sensitive unresolved questions as the agreement moves toward finalization.
Years of Political Tensions
This deal comes after years of debate over TikTok’s future in the U.S. In 2020, Donald Trump ordered ByteDance to sell TikTok within 90 days, though the order was blocked in court. In 2023, Joe Biden signed legislation requiring TikTok’s U.S. operations to be spun off or face a nationwide ban. The divestiture deadline, originally set for January 19, has been extended several times under Trump’s direction. During this period, major companies such as Oracle, Amazon and Blackstone expressed interest in acquiring a stake in the platform.
Next Steps and User Migration
Existing U.S. users would be migrated to the new version of the app, while Oracle would continue providing cloud services as part of its current agreement. The deal reportedly came together after two days of talks in Madrid and Donald Trump and Xi Jinping are expected to officially sign it later this week.
.svg){kind=small}