An impending ban on TikTok in the United States has been put on hold after officials from Washington and Beijing struck a framework agreement that would allow the popular video-sharing platform to continue operating under new conditions.
Former President Donald Trump told reporters on Tuesday that the U.S. and China had “reached a deal” during talks in Spain to separate TikTok’s American business from its Chinese parent, ByteDance. The arrangement is expected to be finalized on Friday during wider trade negotiations with Chinese President Xi Jinping. Trump also extended ByteDance’s divestment deadline for a fourth time, setting December 16 as the new cutoff date.
At the heart of the dispute is TikTok’s powerful content-recommendation algorithm, widely seen as the driving force behind its commercial success. U.S. lawmakers have argued the algorithm could be used by China to influence American public opinion, while Beijing has insisted its export laws give it the right to approve any transfer of such technology.
Wang Jingtao, deputy director of the Cyberspace Administration of China, confirmed at a press conference in Madrid that both sides had agreed to “licensing the algorithm and other intellectual property rights.” He added that ByteDance would entrust a partner with handling TikTok U.S. user data and content security.
Although the specifics remain murky, an Asia-based ByteDance investor told the Financial Times the new American TikTok entity would use parts of the Chinese algorithm but train it in the U.S. Meanwhile, the Wall Street Journal reported that engineers may recreate the recommendation system entirely for a new app that current U.S. users would migrate to.
The Journal also named Oracle Corp., Andreessen Horowitz, and Silver Lake Management as members of the investor group expected to take control of TikTok’s U.S. business. Under the reported deal, ByteDance’s stake would fall below 20 percent, in line with a 2024 law requiring divestment to a U.S. owner. Non-Chinese investors in ByteDance, including Susquehanna International, KKR, and General Atlantic, would comprise the bulk of the remaining shareholders.
Oracle, led by Trump ally Larry Ellison, already hosts TikTok’s U.S. data and is expected to continue providing cloud services. The restructured company would reportedly be overseen by a board dominated by American executives, including one seat designated by the U.S. government.
Treasury Secretary Scott Bessent said the agreement preserves the app’s “Chinese characteristics” while addressing U.S. security concerns. Still, members of Congress remain wary, with the House Select Committee on the Chinese Communist Party insisting that any shared algorithm would violate the law.
A final decision will ultimately rest with the President, who must determine whether ByteDance has sufficiently divested its U.S. operations. For now, the latest deal appears to postpone the app’s ban while leaving open questions about how much influence China will retain over TikTok’s core technology.
