ByteDance, the Chinese parent company of TikTok, has finalised a landmark agreement to establish a US-majority-owned joint venture to secure American user data and avoid a nationwide ban.
The move follows years of regulatory pressure in the United States, where TikTok faces scrutiny over national security concerns. The app has more than 200 million users in the US.
Under the agreement, the newly formed TikTok USDS Joint Venture LLC will oversee US user data, applications, and recommendation algorithms. ByteDance said the venture will implement strict data privacy and cybersecurity controls.
American and global investors will hold 80.1% ownership, while ByteDance will retain 19.9%. Three managing investors, Oracle, Silver Lake, and MGX, will each own 15% stakes.
A White House official confirmed that both the US and Chinese governments have approved the deal. The Chinese Embassy in Washington did not issue an immediate comment.
Background to the Deal
The agreement aligns with terms outlined in September, when Donald Trump delayed enforcement of a law that would have banned TikTok unless ByteDance divested its US operations. Trump later said the deal met divestiture requirements under the 2024 law.
#Latest: ByteDance has set up #TikTok USDS Joint Venture LLC to avert a U.S. ban. The new entity will safeguard U.S. user data, apps and the algorithm.
American and global investors, including Oracle, Silver Lake and MGX, will hold an 80.1% ownership stake, while ByteDance… pic.twitter.com/dwmJKHZExA
— CGTN (@CGTNOfficial) January 23, 2026The White House previously stated that the venture would operate TikTok’s US app. However, details such as long-term commercial ties between ByteDance and the venture remain undisclosed.
Trump, who has more than 16 million followers on TikTok, has credited the platform with helping his reelection campaign. The White House also launched its own official TikTok account in August.
Leadership and Operations
Former TikTok USDS executives Adam Presser and Will Farrell have been appointed CEO and Chief Security Officer, respectively. TikTok CEO Shou Chew will sit on the venture’s board.
TikTok said the venture will retrain and update the recommendation algorithm using US user data. The algorithm will be hosted and secured within Oracle’s US-based cloud infrastructure.
According to earlier Reuters reporting, ByteDance will retain ownership of TikTok’s US business operations but will transfer control of user data, content moderation, and algorithms to the new venture.
A separate ByteDance-owned unit will continue to manage revenue-generating activities such as advertising and e-commerce. The US venture will receive a share of revenue for providing technology and data services.
Additional investors include the Dell Family Office, founded by Michael Dell, as well as Vastmere Strategic Investments, Alpha Wave Partners, Revolution, Merritt Way, Via Nova, Virgo LI, and NJJ Capital. The agreement marks one of the most significant restructurings of a global social media platform under US national security pressure.
