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TikTok has taken a major step toward securing its future in the United States after its Chinese parent company, ByteDance, announced it has signed binding agreements with three major investors to form a new joint venture that will operate TikTok’s U.S. app. The move aims to resolve long-standing national security concerns and avoid a potential U.S. government ban affecting more than 170 million American users.
According to the agreement, the new entity, named TikTok USDS Joint Venture LLC, will be led by American and global investors, with ByteDance retaining a minority stake. U.S. and global investors will collectively own 80.1% of the joint venture, while ByteDance will hold 19.9% following the divestiture. The three managing investors are Oracle, Silver Lake, and Abu Dhabi-based MGX, which together will own 45% of the new company, with each holding a 15% stake.
TikTok CEO Shou Zi Chew told employees that the joint venture will operate as an independent entity with authority over U.S. data protection, algorithm security, content moderation, and software assurance. Oracle will serve as the trusted security partner, responsible for safeguarding sensitive U.S. user data, which will be stored on Oracle’s secure cloud infrastructure in the United States.
The deal aligns with the framework unveiled in September, when enforcement of a 2024 law requiring ByteDance to divest TikTok’s U.S. assets was delayed. That law mandated TikTok to cease operations by January 19 unless a divestiture was completed. President Donald Trump, who began his second term on January 20, opted not to enforce the ban, stating the agreement met divestiture requirements.
While the new U.S. joint venture will control core security and moderation functions, TikTok’s global U.S. entities will continue managing certain commercial activities such as advertising, e-commerce, and marketing to maintain platform interoperability. The board of the new company will include seven members, with ByteDance appointing one and Americans holding the majority.
Despite optimism from analysts who expect regulatory approval to proceed smoothly, some lawmakers remain skeptical. Democratic Senator Elizabeth Warren raised concerns about transparency and investor influence, while Republican leaders indicated future congressional oversight.
If approved, the agreement would conclude years of uncertainty surrounding TikTok’s U.S. operations and allow the platform to continue operating amid heightened scrutiny over data security and foreign ownership.
