TikTok finalized a deal on January 23 to form a new American entity with major investors including Oracle, Silver Lake and the Emirati firm MGX, clearing away the threat of a ban that had loomed for years over the platform used by more than 200 million Americans. The new structure preserves user access while establishing safeguards over data protection, algorithm security, content moderation and software integrity.

The agreement marks an end to years of uncertainty about whether the social video platform would remain available in the United States, resolving a prolonged standoff after Congress passed a law requiring TikTok to find a new owner and President Biden signed it into law.

Deal Structure

TikTok announced the new entity would operate with what it called “defined safeguards that protect national security through comprehensive data protections, algorithm security, content moderation and software assurances for U.S. users.” Oracle will handle data storage for American users locally, while the content recommendation algorithm will be retrained, tested and updated on U.S. user data.

Adam Presser, who previously served as TikTok’s head of operations and trust and safety, will lead the new venture as chief executive. A seven-member board of directors with a majority of American members will govern the entity, including TikTok CEO Shou Chew.

Path to This Moment

The deal ends a protracted conflict over TikTok’s fate. In 2024, Congress passed legislation with bipartisan support requiring TikTok to divest itself or face a ban. President Joe Biden signed it into law. The ban deadline was set for January 2025, and the platform went dark for several hours when that deadline arrived.

On his first day in office in January 2026, President Trump signed an executive order directing his administration to seek an agreement for TikTok’s continued operation rather than enforce the ban. Trump praised the finalized deal in a Truth Social post, thanking Chinese leader Xi Jinping specifically “for working with us and, ultimately, approving the Deal.” He added that he hoped “that long into the future I will be remembered by those who use and love TikTok.”

Guo Jiakun, a Chinese Foreign Ministry spokesperson, said Friday: “China’s position on TikTok has been consistent and clear,” echoing an earlier statement from the Chinese embassy in Washington.

The Algorithm Question

The algorithm at the heart of TikTok’s content recommendation system has been the central national security concern throughout debates over the platform. The U.S. law that mandated divestment specifically required TikTok to “cut ties — specifically the algorithm — with ByteDance,” according to the regulation passed with broad congressional support.

China had previously maintained that the algorithm must remain under Chinese control by law. Under the new deal’s terms, ByteDance will license the algorithm to the U.S. entity, which will retrain it on American user data.

Anupam Chander, a professor of law and technology at Georgetown University, underscored the stakes: “Who controls TikTok in the U.S. has a lot of sway over what Americans see on the app.”

The U.S. law also prohibits “any cooperation with respect to the operation of a content recommendation algorithm” between ByteDance and the new American ownership group. The extent to which ByteDance’s continued involvement in algorithm licensing will satisfy that restriction remains unclear.

Investor Breakdown

Oracle, Silver Lake and the Emirati firm MGX each hold 15 percent stakes as managing investors. Additional investors include the investment firm of Michael Dell, billionaire founder of Dell Technologies. ByteDance retains 19.9 percent of the joint venture.

The agreement represents the first substantial resolution to a question that has shadowed the platform’s American operations for years, as policymakers on both sides of the political aisle sought to address national security concerns while preserving access to a service used by more than 200 million Americans.