President Donald Trump signed an executive order on Thursday finalizing a deal to shift TikTok into American ownership, resolving one of the most contentious tech disputes between Washington and Beijing.
The agreement ensures that TikTok, which faced the threat of being banned in the United States, will continue to operate under a new U.S.-controlled structure. The move follows legislation requiring the app’s Chinese parent company, ByteDance, to divest from its American operations over national security concerns.
Structure of the Deal
Under the terms, American investors will hold a majority stake of roughly 65% in the newly established U.S. entity. ByteDance and its Chinese shareholders will retain a minority position, expected to be less than 20%.
A central element of the deal involves TikTok’s recommendation algorithm. The U.S. company will receive a licensed version of the technology, separating it from direct Chinese oversight. Governance of the new entity will fall to a seven-member board made up mostly of U.S. cybersecurity and national security specialists.
A Lower Valuation Than ByteDance
According to estimates shared during the announcement, the new U.S.-based TikTok company is valued at around $14 billion. By comparison, ByteDance as a whole is worth approximately $330 billion, making the spinoff a much smaller player in the global market.
For perspective, Meta, the parent of Facebook and Instagram, holds a market capitalization exceeding $1.8 trillion, underscoring the gap between TikTok’s American branch and other major tech giants.
Oracle Takes the Lead
The group of U.S. investors is led by Oracle, the software and cloud computing giant. Oracle will oversee TikTok’s operations in the country, manage the storage of user data, and license the platform’s algorithm.
Other well-known investors are also part of the consortium, including Oracle co-founder Larry Ellison, media executive Rupert Murdoch, and Dell Technologies CEO Michael Dell. The administration has indicated that further names could be announced in the coming days as the investment details are finalized.
Officials have stressed that the arrangement ensures ByteDance and Chinese authorities will no longer have access to U.S. user data, addressing a long-standing concern among lawmakers.
Political and Content Implications
The new deal has sparked questions about how TikTok’s algorithm will operate under American control. Critics have raised concerns that political interests could influence content recommendations. While the administration has not suggested any changes to the app’s current practices, officials emphasized that the platform is expected to continue offering diverse and balanced recommendations to its users.
Resolving National Security Tensions
The agreement comes after years of scrutiny and bipartisan pressure in Congress, where lawmakers repeatedly raised alarms about TikTok’s ties to China. Critics argued that the app posed risks ranging from data privacy violations to potential use as a propaganda tool. TikTok denied those accusations, but lawmakers moved forward with legislation demanding divestiture.
Earlier this year, the Supreme Court unanimously upheld the ban that would have forced TikTok out of the U.S. market unless ByteDance complied. Trump, upon taking office, issued temporary orders delaying enforcement while negotiations continued. The new executive order—titled “Saving TikTok”—formally recognizes the transfer as a “qualified divestiture,” putting the app on track to remain in the country.
The process of completing the separation from ByteDance is expected to take about 120 days.
Broader Push Into Tech
The TikTok deal is part of a broader trend under Trump’s administration to expand U.S. influence in the technology sector. Earlier this month, the federal government acquired a 10% stake in semiconductor giant Intel. The administration has also called on major companies like Apple and Nvidia to direct larger investments into domestic manufacturing and innovation.
For Trump, the TikTok outcome also carries political weight. The app has roughly 180 million users in the U.S., making it one of the country’s most widely used social platforms. Trump has credited social media as a factor in mobilizing younger voters during the 2024 election, though TikTok’s exact role remains debated among analysts.
Leading up to the deal, Trump had suggested that the U.S. government would receive a special payment, or “fee-plus,” for facilitating the negotiations. However, the final announcement confirmed that the federal government will simply benefit from tax revenue generated by the new U.S. TikTok entity, rather than receiving a direct payout.
