After years of legal battles, national security fights, executive orders, and shifting political winds, TikTok’s U.S. operation has officially been sold to American investors, averting the long-threatened ban that could have cut off more than 200 million American users from the platform.
Terms of the Deal
ByteDance, the China-based parent company that built TikTok into one of the world’s most influential social platforms, has agreed to reduce its control and hand majority ownership of the U.S. business to a group of investors, forming a new company called TikTok USDS Joint Venture LLC. Under this deal, U.S. investors control roughly 80.1% of the joint venture, led by American tech and finance names, including Oracle, Silver Lake, and MGX, each holding 15% ownership of TikTok. Leadership positions in the new company fall to seasoned TikTok executives, such as Adam Presser, who was named CEO, tasked with managing everything from security and moderation to data protection. U.S. operations will also oversee other related apps like CapCut and Lemon8. Bytedance will still maintain 19.9% ownership of the company, the maximum permitted under the law.
TikTok says it will focus on 4 key areas under this new joint venture.
- TikTok will focus on the cybersecurity program that is audited and certified by third-party cybersecurity experts.
- The company is going to update, train, and test the algorithm on US user data, which will be secured with US Oracle Cloud.
- The new company will secure US Apps and validate the source code on an ongoing basis with Oracle.
- The joint venture will moderate content in TikTok’s feed, deciding safety protocols and which posts to leave up and which to take down.
Numbers 1-3 are not new to TikTok, as those initiatives have been in place since 2022. Only the fourth clause is new and poses a problem as decisions about what content stays up, gets taken down, or goes viral will be shaped more by American laws, public pressure, and election-year scrutiny. Additionally, with this new joint venture with Trump at its center, it is unclear what the content moderation will look like and if it will be adjusted to fit conservative views. While the deal eases fears about Chinese influence, it doesn’t end worries about government power, as user data is still subject to U.S. laws and investigations. Additionally, Oracle, with permission from its users, can collect location information(including device geolocation), which cannot be turned off in phone settings, and sell viewers’ data to promote ads both on and off the platform.
Anupam Chander, a law and technology professor at Georgetown University, said the TikTok deal allowed for “more theoretical room for one side’s views to get a greater airing.”
“My worry all along is that we may have traded fears of foreign propaganda for the reality of domestic propaganda,” he added.
Other new changes to the app
When people upload videos onto TikTok, users own their videos; however, it also gives the company a worldwide, permanent licence to use them. This means TikTok can copy, distribute, remix, show to anyone, and use it to train its AI system called Tako. Under this new policy, users will not receive payment for TikTok’s use of their content.
Anytime a user is selling, promoting, or giving a product away for free, they must clearly disclose such information. If a user is inactive for 180 days, banned, violates policies, or infringes any rights, TikTok can reclaim said username. There will be no disputes or arbitration unless it’s in Los Angeles County.
History
Concerns about TikTok’s ownership first entered U.S. politics in 2019, when lawmakers and national security officials began warning that ByteDance’s ties to China could give Beijing access to American user data or influence what people see on the app. Those concerns intensified during the Trump administration, which attempted to force a sale of TikTok’s U.S. operations through executive action. The issue resurfaced in 2023, when TikTok CEO Shou Zi Chew testified before Congress in a high-profile hearing that focused on data security, children’s safety, and the platform’s relationship with the Chinese government. While Chew denied that TikTok posed a national security threat, the hearing solidified bipartisan skepticism and made legislative action more likely. That momentum culminated in 2024, when Congress passed a law requiring TikTok to either divest from ByteDance or face a ban in the United States. The bill, signed into law amid rare bipartisan agreement and upheld by the Supreme Court, banned the app if it did not separate itself from ByteDance by early 2025. The app even went dark for 14 hours as the law’s deadline approached, sending many users into panic. In an attempt to find a TikTok duplicate, users moved to RedNote, a Chinese-based app similar to Instagram, which raised the app’s popularity to #1 in the app store. However, Mr. Trump formally delayed the enforcement of the law several times after he took office again last January, as he pushed the company to reach a deal for new ownership.
Investors
Oracle is a cloud computing and database company founded in the 1970s that works with major tech firms, including OpenAI, on data-center infrastructure. It was co-founded by Larry Ellison, now its executive chairman and chief technology officer, who—along with his son David Ellison—has close ties to President Trump. Larry Ellison has frequently visited the White House and Mar-a-Lago, while David Ellison recently appeared with Trump at a UFC event and later spent $7.7 billion to acquire the league’s broadcast rights.
MGX is an Emirati investment firm launched in 2024 that focuses on technology and A.I., with major investments in semiconductors and data centers. It was founded by Abu Dhabi’s sovereign wealth fund Mubadala and the A.I. company G42, which previously drew scrutiny from U.S. intelligence agencies over ties to Chinese firms. G42 has since divested from several Chinese investments, including ByteDance, amid congressional pressure and a partnership with Microsoft. MGX has also been involved in deals linked to President Trump, including a 2025 transaction with Binance that used a stablecoin developed by a Trump family–backed crypto firm.
Other investors include Shou Chew, the former and now director of TikTok; Dell Family Office; Vastmere Strategic Investments, LLC, an affiliate of Susquehanna International Group, LLP; Alpha Wave Partners; Revolution; Merritt Way, LLC, controlled and managed by partners of Dragoneer; Via Nova, an affiliate of General Atlantic; Virgo LI, Inc., investment arm of a foundation established by Yuri and Julia Milner in support of science; NJJ Capital, the family office of Xavier Niel. Several of these investors have some ties to the Trump administration, either as donors to his campaign, connected to super PACs, or have philanthropic ties.
Implications
The TikTok buyout is already reshaping how lawmakers think about regulating powerful technology platforms. Rather than relying on fines or content rules, Congress used ownership and control as its main leverage, signaling a shift toward structural solutions when national security concerns are involved. This approach could influence how future foreign-owned apps, data brokers, or A.I. companies are handled, especially those operating at a massive scale. Internationally, the deal may encourage other governments to demand local ownership or oversight of global platforms, as the US successfully set the precedent.
Additionally, the TikTok buyout may also strengthen congressional arguments for closer scrutiny of U.S. universities and their joint ventures with Chinese institutions. Lawmakers have already questioned partnerships such as the University of Michigan–Shanghai Jiao Tong University Joint Institute, which operates degree programs and shared research in engineering and applied sciences. Due to congressional pressure, the University of Michigan pulled out of its partnership, closing the university last January. Similar concerns have been raised about joint labs, exchange programs, and dual-degree arrangements at other U.S. universities, particularly where federally funded research, advanced technology, or sensitive data are involved.
This deal isn’t about strengthening and consolidating American users’ data on US soil. The main reason this sale was brought up was that American investors did not like how a foreign app is making so much money without them being involved. Meta, one of the largest social media companies in the world, which owns both Facebook and Instagram, has heavily lobbied Congress to pass this deal in order to retain its users or move TikTok’s exclusive users to its platform. As such, this isn’t about national security but more about their own personal and financial interests.
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