Could the US Government Buy TikTok?

[ResidentialBusiness]

Heads up: TikTok is technically still banned. While President Trump has promised to hold off on enforcing the TikTok ban until April, it’s still not being distributed on either Apple or Google’s app stores, and in the long term, Bytedance is still expected to sell the app to an owner in the United States. In the past, Meta, Microsoft, and other big tech companies have been floated as potential new owners, but now, Trump is suggesting a surprise candidate: the United States government.

In an executive order signed Monday night, the President directed the government to put forth a plan for a "sovereign wealth fund,” which would allow the government to directly invest into private companies and use the returns how it sees fit. The Treasury and Commerce Departments have 90 days to submit a plan, with Trump saying “We’re going to create a lot of wealth for the fund.”

Said wealth could then be used to fund infrastructure such as highways or airports, but in a more unexpected direction, Trump also suggested the government could use the fund to buy TikTok.

“We’re going to do something, perhaps with TikTok, and perhaps not. If we make the right deal, we’ll do it.” Specifically, Trump suggested the government could acquire a 50% stake in the company, which while not technically hitting the magic 51% number needed for total control, would be enough to grant it veto power.

As has been the case with Trump’s executive orders so far, details will probably still need to be worked out. Such a purchase would drastically change the nature of TikTok, running the risk of effectively making it state media, although it would technically meet the terms of the ban, which states Bytedance cannot hold more than a 20% stake in the company and can’t be involved in its operation. 

Additionally, the U.S. can own a private corporation, as is the case with Amtrak, but a state-sponsored, user-driven social media site would be uncharted territory. Following a mass exodus from X following Elon Musk’s acquisition of the site, there would be nothing stopping users disgruntled with a U.S.-owned TikTok from fleeing to alternatives. 

The biggest thorn in the side of a potential government-backed TikTok purchase might be the timing of the buyout itself, as the ban is set to come back into effect again prior to the fund’s establishment. However, the law does give Trump the authority to further extend the timeline for Bytedance to sell if he feels significant progress is being made towards a deal.

As for the sovereign wealth fund itself, while it’s a first for the federal government, it’s not a new idea. States such as Texas as well as countries including Singapore, Australia, and the United Arab Emirates all currently run their own sovereign wealth funds, with all sovereign wealth funds across the globe totalling to about $8 trillion.

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