On December 16, 2025, TikTok reached a major regulatory milestone with the finalization of a restructuring deal that could dramatically reshape its operations in the United States. This deal follows years of regulatory negotiations and comes in response to U.S. legislative pressure for TikTok to either divest or face a potential ban. The new structure will result in the formation of TikTok USDS Joint Venture LLC, a company that will be majority-owned by American investors, marking a significant shift in the platform’s ownership and operations.
Under the newly established structure, three key U.S. investors—Oracle, Silver Lake, and MGX—will each hold a 15% stake in the new joint venture. The remaining 30.1% will be controlled by existing U.S. stakeholders, while ByteDance, TikTok’s parent company, will retain minority ownership. This arrangement is designed to satisfy the concerns raised by U.S. regulators regarding the control of user data and the potential security risks tied to TikTok’s operations under Chinese ownership.
The restructuring is the result of years of negotiation between TikTok and U.S. lawmakers, who have expressed concerns about the platform’s data privacy practices and the possible misuse of American user information by the Chinese government. The U.S. government has long been worried that TikTok’s ties to China could allow Beijing access to sensitive data, which could be used for political or economic leverage. As a result, the passage of divest-or-ban legislation accelerated discussions, ultimately leading to this landmark restructuring agreement.
One of the key features of the deal is that the new entity, TikTok USDS, will operate independently to manage crucial aspects of the platform’s operations, including data protection, algorithm security, content moderation, and software assurance. This new structure is designed to prioritize compliance with U.S. legal and operational standards, ensuring that the platform’s American operations are free from foreign influence. By centralizing control of these areas within the U.S., the new venture aims to address long-standing concerns regarding the transparency and security of user data.
The deal’s finalization is expected to have a significant impact on TikTok’s operations in the United States, where the platform has become one of the most popular social media apps, with over 170 million active users. The new structure is designed to ensure the continued accessibility of TikTok to American users while maintaining the stability of the advertising ecosystem that depends on the platform’s vast user base. Advertisers, creators, and businesses have become heavily reliant on TikTok as a key marketing and engagement tool, and the restructuring deal aims to preserve this dynamic.
In addition to securing TikTok’s place in the U.S. market, the deal is likely to have broader implications for the global social media landscape. It underscores the growing tension between national security concerns and the expanding influence of global tech giants, particularly those with ties to China. The outcome of this deal may set a precedent for how other foreign-owned platforms navigate regulatory challenges in the U.S. and other countries with stringent data privacy and national security laws.
With the agreement expected to close by January 22, 2026, TikTok’s U.S. restructuring will likely mark the beginning of a new chapter for the company, one in which it must balance compliance with local laws while continuing to serve a vast and diverse user base. For TikTok, this deal represents a strategic pivot that could influence the platform’s operations and its ability to thrive in a highly competitive and ever-evolving digital landscape. As the platform continues to grow in influence, its ability to adapt to regulatory pressures will be critical to its long-term success in the U.S. and beyond.
