In a move that’s set the tech and political worlds abuzz, President Donald Trump on Thursday signed an executive order approving the $14 billion spin-off of TikTok’s U.S. operations from its Chinese parent, ByteDance. The deal, years in the making and fraught with legal, political, and economic hurdles, will see a new American-controlled joint venture take the reins of one of the world’s most influential social media platforms—though not without controversy and a swirl of unanswered questions.
Trump’s order formalizes a plan that’s been the subject of heated debate and high-stakes negotiation since 2024, when bipartisan legislation demanded ByteDance divest from TikTok or face a ban in the U.S. The Supreme Court upheld that law earlier this year, setting the stage for Thursday’s dramatic announcement. As reported by CNN and NPR, the new joint venture will be controlled by a group of U.S. investors led by Oracle, with tech titan Larry Ellison, venture capital powerhouse Andreessen Horowitz, and private equity giant Silver Lake at the helm. Other big names, including Michael Dell and media mogul Rupert Murdoch, are also part of the investor lineup.
“This is going to be American-operated all the way,” Trump declared during the Oval Office signing, emphasizing the role of Oracle and the involvement of what he described as “world-class investors.” He also expressed gratitude to Chinese President Xi Jinping, saying, “I have great respect for President Xi, and I very much appreciate that he approved the deal, because to get it done properly, we really needed the support of China and the approval of China.”
Yet, as CNBC and LastPost noted, China’s official response has been muted. Chinese state media remained largely silent, with only a single state-affiliated Weibo account quoting a Fudan University professor who called the arrangement a “win-win” for both countries. No ByteDance representatives were present at the signing, and both ByteDance and the Chinese Embassy in Singapore declined to comment. According to a statement from China’s Foreign Ministry, the government “respects the wishes of the company and is pleased to see the company conduct commercial negotiations and reach a solution that complies with Chinese laws and regulations and balances interests, all while adhering to market rules.” The ministry also urged the U.S. to “provide an open, fair and non-discriminatory business environment for Chinese companies investing in the United States.”
The technical and organizational challenges facing the new entity are formidable. The structure of the joint venture—how it will operate independently from ByteDance, how it will secure user data, and who will control TikTok’s prized algorithm—remains to be fully clarified. Data privacy and cybersecurity attorney Lily Li told CNN that “a first step here would be ironclad corporate controls,” stressing that oversight and security depend on how separate the new company is from its Chinese origins.
Under the framework laid out in Trump’s executive order, ByteDance and its affiliates will retain less than a 20% stake in the new TikTok U.S. company, while American investors will hold the remaining 80%. The deal also stipulates that Oracle will play a central role in hosting and overseeing all American TikTok data. ByteDance will license its algorithm to the U.S. entity, which will retrain it using only the data from the 170 million U.S. users—an arrangement designed to address long-standing national security concerns about Chinese access to sensitive information and the potential for algorithmic manipulation.
Still, some experts remain skeptical. As James Sullivan of JP Morgan told CNBC, “Trump’s proposed TikTok deal lacked clarity on who is in control of the algorithm, leaving the national security concerns wide open.” Lawmakers from both parties have repeatedly warned that Beijing could use TikTok to influence public opinion or access American user data. The Pew Research Center recently reported that one in five U.S. adults now regularly gets news from TikTok, up from just 3% in 2020, underscoring the app’s growing influence on American society and politics.
Adding a layer of controversy, details have emerged about a multibillion-dollar payment that the U.S. investor group agreed to make to the federal government as part of the deal. According to NPR, the sum—described by insiders as a “finders’ fee”—was accepted without protest by the investors, who saw it as the cost of doing business in the current political climate. Luigi Zingales, a finance professor at the University of Chicago, criticized the arrangement, saying, “At a minimum, this now means there is a tax imposed on every major business transaction. But even worse, businesses will no longer be focused on innovating and creating value and instead the whole game now is rent-seeking.”
This payment is emblematic of what some experts have dubbed a new “shakedown scheme” under the Trump administration, which has sought similar fees or equity stakes in other high-profile business deals, from semiconductor giants Nvidia and AMD to U.S. Steel and Intel. Yale School of Management professor Jeffrey Sonnenfeld went so far as to call these interventions “a gross violation of what capitalism is supposed to stand for. I’d even call it extortion. Privately, CEOs are horrified.”
The deal has also drawn criticism for what some see as crony capitalism, given the involvement of Trump allies like the Murdochs—owners of Fox News, The New York Post, and The Wall Street Journal. Richard Tofel, former assistant publisher of The Wall Street Journal, remarked, “There is a growing set of examples of crony capitalism that the Trump administration is putting into place across this country. American industry—which would have regarded this behavior from a Democrat as anathema and inconsistent with the tenets of unfettered capitalism—is rolling over for it time after time.”
Despite these concerns, the business community has so far remained largely silent, with most executives expressing support for the president’s approach in public, even as many voice deep unease in private. As Sonnenfeld noted, “Fear of retaliation is motivating the silence, but there has got to be a trigger line to stop this. We just don’t know what that is yet.”
For now, the TikTok deal faces three immediate hurdles: finalizing the joint venture’s organizational structure, overcoming technical and data security challenges, and mollifying a skeptical Congress. All this must occur while awaiting Beijing’s final approval—a decision that may well hinge on broader U.S.-China trade negotiations. Trump has extended the deadline for enforcement of the TikTok ban until January 23, 2026, giving the parties 120 days to hammer out the details and close the deal.
As the dust settles, one thing is clear: the fate of TikTok in America is now a test case for the future of global tech, national security, and the evolving relationship between business and government power. The outcome will have ripple effects far beyond the world of viral videos and dance challenges.
