TikTok’s Chinese owner, ByteDance, has signed a series of binding agreements with US and global investors to secure the platform’s operations in America, averting a potential ban. CEO Shou Zi Chew informed employees on Thursday that the deal, which is set to close on 22 January 2026, will allow TikTok to continue serving its massive US user base while addressing national security concerns raised by Washington.

Structure of the Deal

Under the agreement, ownership of TikTok’s US operations will be split as follows:

• ByteDance will retain 19.9%
• Oracle, Silver Lake, and Abu Dhabi-based MGX will each hold 15%
• 30.1% will be held by affiliates of existing ByteDance investors

The deal also includes a licensing arrangement allowing Oracle to access TikTok’s recommendation algorithm, a key component in mitigating US national security concerns.

TikTok stated that the agreement will enable over 170 million Americans to continue using the platform as part of “a vital global community.”

Background: TikTok Under Threat

The deal follows years of political pressure and regulatory scrutiny in the United States. In April 2024, Congress passed a law threatening to ban the app over national security concerns unless ByteDance sold its US operations. Originally set to take effect on 20 January 2025, the law was repeatedly delayed as successive administrations negotiated a potential sale.

Former President Donald Trump supported delaying enforcement and negotiated directly with China, reportedly securing approval from President Xi Jinping for the deal’s structure and algorithm licensing. Despite initial uncertainty, the agreement now represents a carefully calibrated solution amid ongoing US-China tensions over trade and technology.

Alvin Graylin, a lecturer at MIT, noted:

“TikTok has become a bargaining chip in the wider US-China relationship. Beijing’s approval now looks less like capitulation and more like calibrated de-escalation.”

Controversy and Criticism

While the deal prevents an immediate ban, critics question whether it adequately protects American users’ data privacy. Senator Ron Wyden (Oregon) expressed skepticism, highlighting that retraining TikTok’s algorithm on US user data may not fully safeguard against external manipulation.

Some small business owners who rely on TikTok for promotion have also voiced caution. Tiffany Cianci, a user with over 300,000 followers, stressed the importance of maintaining the platform’s current experience for entrepreneurs. TikTok reports that more than seven million small businesses in the US market products and services on the app.

“I reserve judgement on whether or not we have saved the app for small businesses,” Cianci said, noting that TikTok’s profit-sharing model is more favorable than competitors like Meta.

Implications for TikTok and US-China Relations

The agreement signals a temporary resolution to TikTok’s uncertain future in the US and underscores the platform’s role in US-China technology negotiations. By ensuring American investors hold a significant stake and gaining approval for algorithm licensing, TikTok can continue operations while addressing security concerns raised by regulators.

Experts suggest that the deal may serve as a blueprint for other foreign-owned tech companies navigating regulatory pressures in the United States, balancing investor oversight with local data security requirements.