Technology TikTok U.S. divestment deal

US TikTok Deal Explained: Who Owns TikTok in the U.S. and What Changes for Users

TikTok has signed a U.S. divestment deal involving Oracle, Silver Lake, and MGX. Here’s who owns what, what changes for users, and key dates.

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TikTok logo with the U.S. flag and company logos for Oracle, Silver Lake, and MGX, illustrating the new ownership deal.
This article explains TikTok's new U.S. ownership deal, detailing who owns what and what changes for users.
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TikTok’s long-running U.S. standoff over national security concerns has entered a new phase: a divestment deal has been signed, a new joint venture is set to run key parts of the business, and American users may eventually have to move to a new version of the app.

For roughly four years, TikTok’s ownership by ByteDance — a Chinese company — has fueled controversy in the United States, largely centered on fears that U.S. user data could be accessed by the Chinese government. The uncertainty has repeatedly spilled into the user experience. Earlier this year, TikTok temporarily went dark in the U.S., leaving millions waiting to see what would happen next before the app returned quickly. TikTok also reappeared in February on both the App Store and Google Play Store.

After multiple deadline extensions and a crowded field of would-be buyers, the tug-of-war appears to be nearing a decisive outcome. A deal has now been signed for TikTok to divest a portion of its U.S. entity to a group of American investors, following an executive order from President Donald Trump that approved the sale of TikTok’s U.S. operations to a U.S. investor group.

The agreement comes after Trump said that President Xi Jinping of China had approved a TikTok deal that would enable a consortium of U.S. investors to control the platform. ByteDance also publicly indicated it would make sure TikTok remains available to American users.

Who owns TikTok in the U.S.?

Under the structure outlined in a memo viewed by TechCrunch, the investor group includes Oracle, private equity firm Silver Lake, and investment firm MGX. Together, those American backers will hold 45% of the U.S. operation, while ByteDance will retain nearly a 20% stake.

Axios first reported the news, citing sources who pegged TikTok U.S. at approximately $14 billion — a figure also referenced by Vice President JD Vance.

The reported ownership and governance details have evolved over time. In September, reporting described a “framework” deal taking shape between the U.S. and China. In that earlier setup, a consortium — including Oracle, Silver Lake, and Andreessen Horowitz — would oversee TikTok’s U.S. operations, with investors expected to hold an 80% stake and the remaining shares belonging to Chinese stakeholders.

The new operating entity: “TikTok USDS Joint Venture LLC”

Operational oversight is expected to sit with a newly formed entity called “TikTok USDS Joint Venture LLC.” According to the memo, this organization will manage sensitive and high-impact areas of the platform, including:

  • Data protection
  • Algorithm security
  • Content moderation
  • Software assurance

This structure is designed to address the core U.S. government concerns: where user data is stored, who can access it, and whether the recommendation algorithm can be influenced from outside the United States.

Oracle’s role as the trusted security partner

Oracle is positioned as a central player in the new arrangement. Per the memo viewed by TechCrunch, Oracle will act as the “trusted security partner,” with responsibilities that include auditing and ensuring compliance with National Security Terms.

Oracle already has an existing relationship with TikTok: it provides cloud services for the platform and handles U.S. user data. It’s also not Oracle’s first time circling the company — Oracle previously made a bid for TikTok in 2020.

What happens to the TikTok algorithm?

A White House official previously said Oracle would replicate and secure a new U.S. version of the algorithm. Under that approach, the U.S.-based owners of TikTok could lease the algorithm from ByteDance, after which Oracle would retrain it.

As described in the memo, ByteDance will not be able to access information about TikTok’s U.S. users and will not have any influence over the U.S. algorithm. In practical terms, the goal is to separate U.S. data and algorithmic operations from ByteDance’s control, while still allowing continuity of the product Americans use.

The deal is scheduled to close on January 22, 2026.

What users in the U.S. should know

For everyday users, the biggest question is whether TikTok will continue to look and feel the same — or whether the experience will change materially as ownership and governance shift. Reports from Bloomberg suggest that once the transaction is finalized, the TikTok app will be discontinued in the U.S., and users will need to switch to a new platform.

What that new platform will be — and how it will differ from the current TikTok — remains unclear based on the information available so far. Still, the idea of a forced transition hints at how complicated it may be to split U.S. operations from ByteDance while meeting U.S. national security expectations around data, code, and algorithmic control.

If a new U.S. platform does arrive, users will likely be watching for answers to practical questions such as:

  • Whether accounts, followers, and content migrate seamlessly or require rebuilding
  • How recommendations change if the algorithm is recreated and retrained under U.S. oversight
  • What happens to creator monetization tools and brand partnerships tied to the existing app
  • How app store availability and updates work during the transition period

None of those details are fully spelled out in the reporting referenced above, but they are likely to shape the user impact more than ownership percentages.

How did we get here?

The TikTok deal didn’t emerge overnight. It is the latest chapter in a multi-year clash between U.S. policymakers and one of the most influential consumer apps in the country — a conflict that has included legal fights, political reversals, and repeated negotiations over a potential sale.

2020: The first major push to ban or force a sale

The first major escalation began in August 2020, when President Donald Trump signed an executive order intended to ban transactions with TikTok parent ByteDance.

In September 2020, Trump’s administration pushed to force a sale of TikTok’s U.S. operations to a U.S.-based company. At that time, some of the leading contenders included Microsoft, Oracle, and Walmart. However, a U.S. judge temporarily blocked Trump’s executive order, which allowed TikTok to continue operating while the dispute played out in court.

The Biden era: a bill, then TikTok’s lawsuit

Momentum picked up again during the transition to the Biden administration. After the Senate passed a bill targeting TikTok, President Joe Biden signed it into law.

TikTok responded by suing the U.S. government. The company argued the ban was unconstitutional and said it — along with its American users — faced violations of First Amendment rights. TikTok has repeatedly denied it poses a security threat and has maintained that its U.S.-stored data complies with local laws.

Trump’s shift — and the push for a new ownership structure

More recently, Trump has taken a different stance than during his first term. In a Supreme Court filing, he signaled a desire to achieve a 50-50 ownership arrangement between ByteDance and a U.S. company.

During the extended negotiation period — including multiple deadline extensions for a potential TikTok ban — numerous parties surfaced as potential buyers or partners.

The bidders who wanted TikTok U.S.

A variety of investor groups and companies expressed interest as the sale process unfolded. Among them was The People’s Bid for TikTok, a consortium organized by Project Liberty founder Frank McCourt. That group had backing from investment firm Guggenheim Securities and law firm Kirkland & Ellis.

Supporters named in the reporting included Reddit co-founder Alexis Ohanian, TV personality and investor Kevin O’Leary, inventor of the World Wide Web Tim Berners-Lee, and senior research scientist David Clark.

Another bidding group described in the reporting was the American Investor Consortium, led by Employer.com founder Jesse Tinsley. Names associated with that group included Roblox co-founder David Baszucki, Anchorage Digital co-founder Nathan McCauley, and the YouTuber MrBeast.

Other interested parties mentioned included Amazon, AppLovin, Microsoft, Perplexity AI, Rumble, Walmart, Zoop, former Activision CEO Bobby Kotick, and former U.S. Treasury Secretary Steven Mnuchin.

Why the ownership structure matters

The intense focus on who owns TikTok in the U.S. — and who controls the algorithm — comes down to a few high-stakes issues: data access, influence over content distribution, and the integrity of the software that runs one of the most powerful recommendation systems in consumer tech.

In the reported deal structure, the creation of TikTok USDS Joint Venture LLC, Oracle’s auditing and compliance role, and the promise that ByteDance won’t access U.S. user information or influence the U.S. algorithm are intended to answer those concerns directly. Whether the arrangement satisfies regulators over time may depend on how these controls work in practice, and how transparent enforcement becomes.

Conclusion

TikTok’s U.S. future now hinges on the closing of the deal scheduled for January 22, 2026, and on whether the new governance model — including Oracle’s security role and the formation of TikTok USDS Joint Venture LLC — can keep the platform operating while meeting U.S. national security demands. For users, the biggest near-term wildcard is whether TikTok will be replaced by a new U.S. platform and what that transition will look like.

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Based on reporting originally published by TechCrunch. See the sources section below.

Sources

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