TikTok has finalized a deal to establish a new majority-American-owned entity, effectively averting a potential nationwide ban or shutdown in the United States. The agreement, announced on January 22, 2026, resolves years of national security concerns surrounding the app’s Chinese parent company, ByteDance, and allows the platform to continue operating for its more than 200 million American users.The new entity, known as TikTok USDS Joint Venture LLC, has been formed in compliance with an executive order signed by President Donald Trump on September 25, 2025. This structure builds on TikTok’s earlier “Project Texas” initiative, which focused on U.S. data security measures, but now establishes a fully independent joint venture with majority non-Chinese ownership.
Under the terms of the deal:
- American and global investors hold 80.1% of the venture.
- ByteDance retains a minority stake of 19.9%.
- The three managing investors—Oracle, private equity firm Silver Lake, and Abu Dhabi-based investment firm MGX—each hold 15% stakes.
- Other investors are involved, contributing to the majority control.
The joint venture operates as an independent entity governed by a seven-member board of directors that is majority-American. Board members include TikTok CEO Shou Chew, along with representatives from Oracle, Silver Lake, MGX, and other stakeholders. Adam Presser, formerly TikTok’s head of operations, trust, and safety, serves as CEO of the new U.S. entity.
Key safeguards implemented through the agreement include:
- Comprehensive data protections, with U.S. user data stored domestically on Oracle’s cloud infrastructure.
- Algorithm security measures, where the content recommendation system is retrained, tested, and updated using U.S. user data.
- Independent content moderation handled by the U.S. entity.
- Software assurances and ongoing validation of source code by Oracle.
- Independent third-party auditors to verify compliance with privacy and security standards.
These measures aim to address longstanding U.S. government concerns that ByteDance could be compelled by Chinese authorities to access American user data or manipulate content via the algorithm for espionage or influence operations.
The deal concludes a multi-year saga that began during President Trump’s first term, when initial attempts were made to restrict or ban TikTok over national security risks. In April 2024, Congress passed the Protecting Americans from Foreign Adversary Controlled Applications Act with bipartisan support, signed by then-President Joe Biden.
The law required ByteDance to divest its U.S. operations or face a ban, effective January 19, 2025. The Supreme Court upheld the legislation, and TikTok briefly went dark in early 2025 before executive actions paused enforcement.
Upon returning to office, President Trump issued multiple extensions and ultimately facilitated the deal through his September 2025 executive order, which cleared the path for the joint venture. Trump praised the resolution on Truth Social, thanking Chinese leader Xi Jinping for cooperation and expressing hope to be remembered positively by TikTok users.
The agreement allows existing users to continue accessing the same app without interruption. It also supports the platform’s ecosystem, including over 7.5 million U.S. businesses that rely on TikTok for discovery, creation, and commerce.
While the deal has been welcomed as a resolution to uncertainty, some analysts and national security experts have raised questions about remaining ties to ByteDance, the algorithm licensing arrangement, and whether it fully complies with the 2024 law’s prohibitions on cooperation between ByteDance and the U.S. entity. Details on the valuation—reportedly around $14 billion—have also drawn scrutiny for being lower than some estimates of TikTok’s U.S. business worth.
Overall, the formation of TikTok USDS Joint Venture LLC marks the end of prolonged regulatory battles and positions the app to operate securely under American-majority control in the United States.
