TikTok deal announced after months of stalled negotiations

President Donald Trump and Chinese officials have reached a framework to transfer TikTok’s American operations to U.S. control, breaking months of deadlock.

About the deal: The president announced the breakthrough Tuesday while extending the divestiture deadline to Dec. 16 for the fourth time. “We have a deal on TikTok … We have a group of very big companies that want to buy it,” said Trump, who has amassed over 15 million followers on the platform. The agreement establishes American majority control through an investor group holding 80% ownership, featuring Oracle, Silver Lake and Andreessen Horowitz alongside current ByteDance stakeholders General Atlantic, Susquehanna International Group and KKR.

Parent company ByteDance, for its part, retains a 19.9% stake, staying below the legal 20% threshold. China also agreed to license the platform’s algorithm to American operators, with Central Cyberspace Affairs Commission Deputy Director Wang Jingtao confirming agreement on licensing “the use of intellectual property rights such as (TikTok’s) algorithm.”

Why this matters: The agreement represents a major diplomatic breakthrough following spring negotiations that collapsed over trade policy disputes. On security concerns, Trade Secretary Scott Bessent emphasized the deal would not be done without “proper safeguards” for national security. For users, the resolution prevents enforcement of a congressional ban that was set to take effect today, protecting a crucial space for many Asian American content creators and their communities.

Bessent told CNBC that the breakthrough came after Trump’s hardline stance, with the president’s readiness to let TikTok “go dark” pressuring China into accepting terms. The timing also follows this week’s high-level trade discussions between American and Chinese officials in Madrid.

Broader implications: The resolution could mark a turning point in deteriorating U.S.-China economic relations. The algorithm licensing model particularly establishes new precedent for how Chinese tech firms might operate under American supervision amid ongoing congressional skepticism. For one, Rep. Raja Krishnamoorthi, a Democrat from Illinois, warned that the core issue remains “the Chinese Communist Party’s access to American data.” Meanwhile, industry observers noted the irony of the final arrangement, since China ultimately retains algorithm control.

For now, the structure preserves global content connectivity between American and international TikTok versions, maintaining creator access to worldwide audiences. The outcome also resonates with Americans who briefly joined Chinese platform RedNote in a protest exodus during January’s TikTok shutdown.

Trump and Chinese President Xi Jinping are expected to finalize the deal during a Friday phone call, potentially setting the stage for their first in-person meeting during the former’s planned Asia visit in late October.