US, China strike TikTok deal – But who will buy the social media platform’s American arm?

The Donald Trump administration confirmed on Monday that it has reached a framework agreement with China to keep TikTok operational in the United States. The deal comes after years of tense negotiations and political wrangling over national security concerns tied to TikTok’s Chinese parent company, ByteDance, that began during Donald Trump’s first term as US President.

US Treasury Secretary Scott Bessent announced the development following high-level trade talks in Madrid. “We have a framework for a TikTok deal,” Bessent told reporters, emphasising that the specific commercial terms remain confidential. “It’s between two private parties, but the commercial terms have been agreed upon.”

Scott Bessent credited US President Donald Trump’s direct involvement with pushing the agreement over the finish line, saying, “Without his leadership and the leverage he provides, we would not have been able to include the deal today.” Trump is expected to speak directly with Chinese President Xi Jinping on Friday to finalise the deal ahead of a planned summit later this year.

US-China TikTok Deal: Why Has TikTok Been Under Threat in US?

TikTok has faced mounting scrutiny in Washington for years, with lawmakers concerned that the app’s Chinese ownership could allow sensitive user data to be accessed by the Chinese government. In April 2024, former President Joe Biden signed a law giving ByteDance nine months to divest its US TikTok operations or face a nationwide ban.

TikTok briefly went offline in the US on 18 January, just before the law took effect. However, Donald Trump, on his first day back in Oval office, signed an executive order delaying enforcement for 75 days. The US President later extended that deadline twice, most recently to 17 September.

While critics argue these delays undermine Congress’ intent, Trump has defended his actions, claiming that a negotiated solution would better safeguard US national security while preserving TikTok for its roughly 170 million American users.

US-China TikTok Deal: What Did China Say About the Deal?

Li Chenggang, China’s top trade negotiator, confirmed on Monday that the two nations had reached a consensus framework to address TikTok-related disputes. Li described the talks as productive but issued a warning to Washington.

“The outcomes of the trade and economic consultations are hard won, and the US side should not, on the one hand, ask China to accommodate its concerns, whilst at the same time continue to suppress Chinese companies,” Li said in Madrid.

China’s apparent willingness to allow ByteDance to consider a sale comes amid broader trade tensions. On Monday, Beijing announced that Nvidia had violated antitrust laws, signalling that disputes over tech dominance remain far from resolved.

US-China TikTok Deal: Who Could Buy TikTok’s US Operations?

The biggest remaining question centres on who will ultimately acquire TikTok’s American assets. While several bidders have emerged in recent months, the leading contender appears to be Oracle co-founder Larry Ellison, who has longstanding ties to TikTok through Oracle’s role as the app’s US cloud provider.

Other groups have expressed interest, including a consortium led by former Los Angeles Dodgers owner Frank McCourt and investor Kevin O’Leary of Shark Tank fame. However, industry analysts believe this group may struggle to finance a purchase expected to run into the tens of billions of dollars.

Notably, McCourt’s group has suggested buying TikTok without its powerful recommendation algorithm — often considered the heart of the platform’s success. This has led many observers to doubt their chances of winning the bid.

Microsoft previously attempted to acquire TikTok in 2020, with CEO Satya Nadella calling it “the strangest deal” he had ever encountered. That deal fell apart, and a later joint bid by Oracle and Walmart also collapsed under Joe Biden administration scrutiny.

US-China TikTok Deal: What Happens Next?

The final details of the agreement will be hashed out when US president Trump speaks with China’s Xi Jinping later this week. US officials have said that a formal deal is essential for a planned Trump-Xi meeting in Asia at the end of October.

On his social media platform Truth Social, Donald Trump hinted at the significance of the negotiations. “The big Trade Meeting in Europe between The United States of America, and China, has gone VERY WELL! It will be concluding shortly,” he posted. “A deal was also reached on a ‘certain’ company that young people in our Country very much wanted to save. They will be very happy!”

For now, TikTok’s future in the US appears secure — but only if the agreement holds and a suitable buyer is found. With more than 135 million active American users and growing political stakes, the fate of the TikTok app remains a defining test of US-China tech relations.