The US and China are engaged in complex negotiations to avoid a ban on TikTok in the US. A part of this process involves US technicians being able to replicate and alter TikTok’s recommendation algorithms.
On Monday, senior White House officials announced that a “framework” for reaching an agreement had been established, aiming to address the ongoing debate over TikTok’s future in the US.
Interestingly, just before talks of a ban surfaced, there was a plan in motion to transfer control of TikTok to American investors.
According to sources, the situation remains dynamic, so specific details—especially regarding the crucial algorithms—might evolve.
This deal could pave the way for a new American company valued at up to $50 billion, with around 172 million users in the US. Notably, among the leading investors are Jeff Yass, a billionaire and supporter of President Trump, along with Atlantic General Bill Ford. Small investors seem eager to get in on the action, too.
“There’s a lot of interest in this, and it looks like Trump, Congress, and even China are on board,” one potential investor remarked.
The original Chinese company behind TikTok will still hold a 19.9% stake in the new venture while retaining full ownership of its other businesses, which boast billions of active users and a market value nearing $300 billion—without a US component.
Larry Ellison, co-founder of Oracle, is set to play a pivotal role in integrating new US companies into Oracle’s cloud systems. However, it’s uncertain if he’ll be able to acquire equity stakes while Oracle serves TikTok as a service provider.
As many users continue to engage with the app, the ownership of its algorithms remains a key sticking point in broader US-China trade discussions.
Currently, US legislation prevents Chinese-controlled TikTok from operating domestically due to concerns about espionage. Nevertheless, former TikTok critic Trump has delayed implementing a ban, possibly believing that younger users could help shift towards his political base in future elections.
Trump noted on True Society that, “The large European trade conference between the US and China is proceeding well,” implying confidence in negotiations.
He added, “We have reached a deal for a ‘specific’ company that the youth of our country wanted to protect. They are quite pleased!”
As reported recently, Trump is expected to announce yet another extension to finalize the TikTok agreement, following discussions between Treasury Secretary Scott Bescent and Trump with Chinese President Xi Jinping.
People familiar with the matter suggest that due to the intricacies involved in reworking the algorithms, Trump might need to push TikTok’s timeline beyond the usual 90 days.
A spokesperson for the White House and one for Bescent did not comment on the situation.
Although President Xi initially resisted relinquishing control of TikTok, he agreed to a compromise, which may help ease trade tensions between the two countries, allowing for Trump’s upcoming visit to Beijing.
Some members of the GOP express concerns that TikTok’s algorithms may facilitate Chinese surveillance and propagate anti-US sentiment. The app’s largest demographic consists of users aged 18 to 24, who form a significant portion of its audience.
Executives are optimistic that the newly established structure will comply with US laws intended to limit Chinese oversight of TikTok’s operations within the country. By constructing a separate entity, they aim to meet these legal requirements.
The current extension is set to expire on Wednesday, and Trump has alluded to taking a tougher stance with TikTok to gain leverage in broader negotiations until official word of the “framework” was revealed.
This framework appears to hinge on a compromise. The new group of US investors won’t own the original algorithms outright but will be allowed to replicate them, distancing the technology from Chinese oversight, while also utilizing applications developed in the US.
