TikTok Finally Avoids US Ban After Major Sale Deal. TikTok has officially finalized a major deal to sell a significant stake in its United States operations. This move is aimed at meeting strict US government rules that threatened to ban the popular video app across the country.
The agreement allows TikTok to continue operating in the US and brings an end to months of uncertainty for millions of users, creators, and advertisers.
Why TikTok Faced a US Ban
US lawmakers raised serious concerns about national security and data privacy. They feared that TikTok’s Chinese parent company, ByteDance, could be forced to share US user data with foreign authorities.
To address this, the US passed a “divest-or-ban” law. It required TikTok to either sell control of its US business to American-linked entities or shut down operations in the country.
Deal Confirmed by TikTok CEO
The deal was confirmed in an internal memo sent by TikTok CEO Shou Zi Chew to employees. Reports by Axios, CNBC, and The Hollywood Reporter first revealed the agreement.
TikTok is targeting January 22, 2026, as the closing date for the transaction, subject to final regulatory approvals.
New Company: TikTok USDS Joint Venture LLC
Under the agreement, a new company called TikTok USDS Joint Venture LLC will be formed. This entity will control TikTok’s US operations and data security.
Ownership Breakdown
- 50% owned by a group of new US-based investors
- 30.1% held by affiliates of existing ByteDance investors
- 19.9% retained by ByteDance
This structure ensures that American stakeholders hold majority control, as required by US law.
Key US Investors Involved
The new investor group includes major US firms:
- Oracle – 15% stake
- Silver Lake – 15% stake
- MGX – 15% stake
Oracle will also play a central role in securing US user data.
What Happens to User Data and the Algorithm
One of the biggest concerns was TikTok’s recommendation algorithm and access to user data.
According to the memo:
- All sensitive US user data will be stored on US-based Oracle cloud servers
- Oracle will act as a trusted security partner
- TikTok will retrain its algorithm using only US user data
- The new entity will oversee data protection, content moderation, and software security
This is meant to prevent outside influence and protect American users.
Independent US Board and Control
TikTok USDS will be governed by a seven-member board, with most members being American citizens.
The board will have authority over:
- Data security
- Algorithm safety
- Content moderation rules
- Compliance with US national security laws
This marks a major shift from TikTok’s previous global control structure.
Political Background and Extensions
TikTok briefly went offline in the US earlier this year after missing an earlier deadline. Later, US President Donald Trump granted multiple deadline extensions to allow negotiations to continue.
A framework agreement between the US and China in September helped push talks forward. The final deal fulfills the requirements of an executive order signed on September 25, 2025.
Impact on Users and Advertisers
TikTok says the changes will not affect:
- The user experience
- Advertisers and brands
- Creators and monetization tools
The platform will continue serving its 170+ million US users without disruption.
Global teams will still manage ads, e-commerce, and marketing, while USDS focuses on security and compliance.
When Will the Deal Fully Close?
The transaction is expected to close within 120 days of the executive order, once all regulatory approvals are completed.
If approved on schedule, TikTok will remain fully operational in the US beyond 2026.
Why This Deal Matters
This agreement could set a global precedent for how governments regulate foreign-owned tech platforms. It balances national security concerns while allowing a major digital platform to continue operating.
For TikTok users in the US, it means one thing clearly: the app is here to stay.
FAQs
Is TikTok banned in the US now?
No. The deal allows TikTok to continue operating legally in the US.
Who controls TikTok US after the deal?
A US-led joint venture with majority American ownership and a US-based board.
Will TikTok’s algorithm change?
Yes. It will be retrained using US user data only.
Is ByteDance completely leaving TikTok US?
No. ByteDance will retain a 19.9% minority stake.
Will users notice any changes?
TikTok says users and advertisers will not see any noticeable changes.
Conclusion
TikTok sale of a major stake in its US operations marks a turning point in tech regulation and digital privacy debates. With American investors, US-based data storage, and independent oversight, the platform has cleared its biggest hurdle yet and avoided a nationwide ban.
