The future of TikTok in the United States remains uncertain, but a deal has been officially signed to divest a portion of the app to a group of American investors. For four years, TikTok, owned by the Chinese company ByteDance, has faced scrutiny and potential bans due to concerns over user data security and its ties to the Chinese government. This agreement, finalized after a lengthy and complex negotiation process, aims to address those concerns while allowing the popular social media platform to continue operating within the U.S.
The deal comes after President Biden signed legislation in April requiring ByteDance to sell TikTok within nine months or face a nationwide ban. Millions of American users have been closely watching the developments, experiencing temporary outages and uncertainty about the app’s availability. Now, a path forward has been established, though significant changes are expected for U.S. TikTok users.
Who Owns TikTok in the U.S.?
According to a memo reviewed by TechCrunch, TikTok’s U.S. operations will be overseen by a joint venture called “TikTok USDS Joint Venture LLC.” This venture will be 45% owned by a consortium of American investors including Oracle, private equity firm Silver Lake, and investment firm MGX. ByteDance will retain approximately a 20% stake in the U.S. entity.
Oracle will play a crucial role as the trusted security partner, responsible for auditing and ensuring compliance with National Security Terms. The company already manages U.S. user data in the cloud for TikTok and previously submitted a bid to acquire the app outright in 2020. The agreement stipulates that ByteDance will not have access to U.S. user data or exert influence over the U.S. algorithm.
The Investor Groups
The American Investor Consortium, led by Employer.com founder Jesse Tinsley, was a strong contender. This group included notable figures like Roblox co-founder David Baszucki, Anchorage Digital co-founder Nathan McCauley, and popular YouTuber MrBeast. Another group, led by Project Liberty founder Frank McCourt, also presented a bid.
Other potential buyers included Amazon, AppLovin, Microsoft, Perplexity AI, Rumble, Walmart, Zoop, former Activision CEO Bobby Kotick, and former U.S. Treasury Secretary Steven Mnuchin. Ultimately, the Oracle-led group secured the agreement with ByteDance.
Implications for TikTok Users
While the deal allows TikTok to continue functioning in the U.S., reports from Bloomberg suggest a significant change is on the horizon. The current TikTok app is expected to be discontinued, and users will be required to transition to a new platform. Details about this new platform, including its features and how it will differ from the existing TikTok, remain unclear.
The transition could be disruptive for the app’s 170 million monthly active users in the U.S., who rely on TikTok for entertainment, news, and connection. The new platform will need to replicate the features that have made TikTok so popular to retain its user base. Concerns about data privacy and security will likely remain a focus as the new platform is developed.
A Timeline of Events
The saga began in August 2020 when then-President Trump issued an executive order aiming to ban transactions with ByteDance. This action was based on national security concerns, alleging that TikTok could be used to collect data on U.S. citizens and share it with the Chinese government. A month later, the administration sought to force a sale of TikTok’s U.S. operations.
A U.S. judge temporarily blocked Trump’s order, allowing TikTok to continue operating while the legal challenges played out. The Biden administration initially paused the legal proceedings to review the risks posed by TikTok, but ultimately moved forward with legislation requiring a sale or ban. This legislation followed reports indicating a “framework” deal between the U.S. and China involving investors like Oracle and Silver Lake.
TikTok responded by suing the U.S. government, arguing the ban violated the First Amendment rights of its users. The company has consistently maintained that it protects user data and operates independently of the Chinese government. Despite these claims, concerns about potential Chinese government influence persisted, driving the push for a sale.
The deal is scheduled to close on January 22, 2026. The coming months will be critical as the new ownership structure is implemented and the transition to a new platform is planned. It remains to be seen whether the agreement will fully address the U.S. government’s security concerns and whether TikTok can maintain its popularity in the face of these changes. The success of the new platform and its ability to attract and retain users will be a key indicator of the long-term viability of TikTok in the United States.
