As Donald Trump assumes office as the 47th President of the United States on January 20, he is expected to sign approximately 100 executive orders, which will not require the tedious approval of the United States Congress. These orders will be hardly surprising and in line with his campaign promises from last year’s presidential race—a complete reversal from the Democratic administration’s policies on energy, climate change, and immigration.
Among these, one crucial executive order will pertain to restoring TikTok’s operations in the United States. The app was banned on Sunday under the Protecting Americans from Foreign Adversary Controlled Applications Act (PASACA), which required its parent company, ByteDance, to divest operations to a US-based entity to address national security concerns regarding data privacy.
This executive order will retain TikTok’s 170 million users in the US, preventing them from becoming “TikTok refugees” migrating to RedNote, another Chinese video-sharing app. Following a brief service disruption on January 19—in line with the Act’s 270-day compliance deadline for ByteDance—American TikTok users experienced a temporary blackout. However, service was quickly restored with TikTok CEO Shou Zi Chew thanking President-elect Trump for his assurance of safeguarding free speech and resuming operations.
Will this rescue be a win-win for both China and Trump?
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TikTok ban—why?
In 2023, TikTok contributed over $24 billion to the US economy. So, why did the Joe Biden administration enact legislation to ban the short video-sharing app, owned by the Beijing-based tech company ByteDance?
Here’s the timeline that may help understand it:
In 2020, the Trump administration raised alarms about TikTok’s data practices; in 2021, President Biden revoked Trump’s executive orders but initiated a thorough review of foreign-controlled apps. By late 2022, Congress advanced the RESTRICT Act to address potential threats from foreign technology. Finally, in early 2024, bipartisan pressure intensified following reports of ByteDance employees potentially misusing US user data. In April 2024, Congress enacted the PASACA, which made it illegal to “distribute, maintain, or update” a “foreign adversary-controlled application” in the US.
TikTok’s alleged collection of American users’ personal data has raised concerns among US security agencies, mainly because ByteDance, headquartered in China, is subject to Chinese laws, which obligate companies to “assist or cooperate” with government intelligence work. These concerns extended beyond privacy violations. TikTok’s proprietary algorithm plays a pivotal role in shaping user behaviour and influencing public opinion. The Biden administration feared that TikTok’s algorithm, by amplifying divisive narratives or or suppressing others, could manipulate political discourse, spread misinformation, or deepen societal divisions—especially given its influence over younger users.
PASACA offered ByteDance an alternative: to transfer its US operations to an American entity, addressing security and transparency concerns while allowing TikTok to continue operating in the US. However, ByteDance chose a legal battle, invoking the First Amendment’s protections of free speech and the press, but ultimately failed to secure a favourable ruling.
Although the version of TikTok operating in the US is technically distinct from its Chinese counterpart, concerns arise due to ByteDance’s ownership and its control over TikTok’s proprietary algorithm, developed in China. Additionally, ByteDance’s involvement in portions of TikTok’s source code and its obligation under Chinese laws to cooperate with government intelligence activities—where authorities have the “power to access and control private data”—have heightened fears of data privacy vulnerabilities and national security risks.
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Trump has the key
A day before entering the White House, Trump acknowledged TikTok’s significant role in his election victory, crediting the platform for helping him secure the youth vote by a remarkable 36-point margin—the largest for the Republican Party in history. During a rally-style speech, Trump remarked, “We need to save TikTok,” and reflected on his “slightly good experience” with the platform during the campaign. However, he warned that without his executive order, TikTok risked being shut down.
To address this, Trump proposed a “joint venture” arrangement, advocating for that an American entity to be part of a shared deal, which he claimed would allow America to “make a lot of money.” He emphasised TikTok’s dependency on his approval, asserting, “TikTok is worth nothing—zero—without the approval… (and TikTok) would run out of business.”
On the flip side, he suggested, “If you [I] do approve, they are worth a trillion dollars…so I said I will approve, but let the United States of America own 50 per cent of TikTok.”
This proposed deal is seen as a strategic move, showcasing Trump’s intent to balance economic interests with voter priorities. Also, by proposing a structure that ensures TikTok operates under American oversight, he not only seems to have saved the app from falling but also leveraged its popularity among the youth—a demographic that proved instrumental in his 2024 election victory.
Also read: 6 reasons why privacy is a lost cause in India. Don’t wait for DPDP Act to fix it
Who benefits from Trump’s deal?
Another advantage Trump sees in his ‘Art of the Deal’ approach with TikTok is the opportunity to reward his business allies with a potential 50 per cent ownership. Among those who could benefit is Elon Musk—founder and CEO of Tesla and SpaceX, and now owner of X (formerly Twitter). Musk, a vocal advocate for “free speech” and Trump’s colleague in the administration, has consistently argued that “TikTok should not be banned in the USA,” even though such a ban could potentially benefit his X platform. Not too long ago, Musk made headlines with his bold and impulsive $44 billion acquisition of Twitter in 2022.
Among other names making headlines include billionaire Frank McCourt— the former owner of the professional American baseball team, Los Angeles Dodgers. McCourt has reportedly made the offer to the Chinese firm and will likely be joined by Kevin O’Leary, a popular face of the American reality show, Shark Tank.
Whether a Trump-led deal would ultimately benefit TikTok remains to be seen. However, Musk’s potential involvement—mainly him integrating X as part of the arrangement—could be a critical factor in shaping the outcome of such a deal.
Regardless of how the deal unfolds, the key question remains: the usage of private data by TikTok. Will a 50/50 ownership split between ByteDance and an American entity ensure data protection and guarantee that user information does not reach China? And will China agree to enter such a partnership, where it would be required to grant the American collaborator partial access—if not complete—to data that Beijing considers a state secret?
Rishi Gupta is assistant director, Asia Society Policy Institute, New Delhi. He tweets @RishiGupta_JNU. Views are personal.
(Edited by Prashant)
This post was originally published on here
