President Trump signed an executive order last week approving a deal to keep TikTok available in the U.S. after a 2024 law required the app’s Chinese parent company, ByteDance, to divest or face a ban. The deal, valued at $14 billion, transfers control of TikTok’s U.S. operations to a group of American and international investors. The administration has indicated that these investors will also gain control of the app’s algorithm, a critical asset for TikTok but also a point of concern for U.S. legislators due to allegations of surveillance by the Chinese government.
The deal raises several questions, including how consumer privacy will be protected and whether the absence of a U.S. national privacy law leaves users vulnerable to surveillance. Concerns also revolve around the extent of government intervention and the potential for increased monitoring of social media activity. Additionally, there are worries about the concentration of control over social media apps and other media properties in the hands of Trump allies.
TikTok’s origins trace back to 2016 with the launch of Douyin in China, which allowed users to create, share, watch, and comment on short video content. When TikTok was released internationally the following year, its focus on video set it apart from competitors like Facebook and Instagram. In 2017, ByteDance acquired Musical.ly, an app for creating and posting short music videos, which had 200 million users before merging with TikTok in August 2018. This merger enabled ByteDance to create a new social media app with 1.6 billion users as of last year.
As TikTok gained popularity in the U.S., concerns about its ownership intensified. While ByteDance and its investors maintained that the Chinese government did not own a stake in the company, U.S. lawmakers remained skeptical. This led to an unprecedented ban on TikTok in 2024, initiated under the first Trump presidency amid growing claims against the app. In February 2019, TikTok settled claims of violating U.S. child privacy laws, resulting in a $5.7 million fine. Later that year, the app faced accusations of censoring protests in Beijing, leading to intense scrutiny from U.S. lawmakers over potential compliance with Chinese government demands. TikTok was also accused of illegally surveilling American users and using its algorithm to facilitate national security intrusions.
During his first term, President Trump issued executive orders focused on national security threats related to technologies created and operated by foreign adversaries like China. These orders led to bans on TikTok and WeChat unless they were sold. Immediate litigation halted the implementation of these bans, which were later revoked by the Biden administration. In 2022, President Biden signed a ban limiting the use of TikTok by federal employees, and in 2024, he signed a broader ban as part of a legislative package focused on providing foreign aid to Ukraine, Israel, and Taiwan. This law required ByteDance to divest by January 19, 2025, or face a shutdown in the U.S., leaving the second Trump presidency responsible for the platform’s fate.
After multiple extensions and negotiations with ByteDance and the Chinese government, President Trump reached a deal to transfer TikTok to U.S. investors. The new arrangement involves a transaction valued at $14 billion, with U.S. and international investors owning 65% of the company, while ByteDance and Chinese investors hold less than 20% of ownership stakes. The order gives the new investors oversight of the algorithm and six out of the seven seats on a board of directors, which will include national security advisers and cybersecurity experts.
Concerns over national security and mass surveillance have driven pressure on ByteDance to divest its investments through a sale to a U.S.-based entity. However, the U.S. government’s hands-on approach in the absence of a comprehensive national data privacy law raises questions about how the new company will handle user data, maintain consumer privacy, protect free speech, and limit government surveillance of social media activities. A March 2025 Pew Research Center poll found that 34% of Americans supported a TikTok ban, with 75% of that group citing concerns about the app’s ownership by a Chinese company. Conversely, 74% of Americans who opposed the ban felt it would restrict free speech.
The transition in ownership may come with tradeoffs affecting users’ privacy, free speech, and the expectation that personal data will be beyond the government’s reach. Politicians using TikTok for campaigning or fundraising may face challenges due to potential government influence. Small businesses relying on TikTok for profits may find their pages surveilled to ensure compliance with government regulations. Civil society organizations opposing the current administration’s policies might also be monitored, potentially affecting voters’ behavior. Changing control of the algorithm could allow its owners to address concerns about online harms to children, especially as children’s online safety laws remain uncertain.
The takeover places control of one of the world’s most influential social media applications into U.S. hands. However, the lack of consumer privacy protections may blur the lines between legitimate government oversight and overreach, leaving TikTok users vulnerable. Congress has made little progress on comprehensive privacy legislation or limits to government surveillance, raising concerns about the opaque nature of the current deal and its arrangements. As a result, U.S. investors approved by the president have newfound control and access to detailed information on Americans’ online behavior.
