Chinese authorities are reportedly considering selling TikTok's U.S. operations to Elon Musk, CEO of Tesla and a key figure in the upcoming Donald Trump administration, according to multiple sources cited by Bloomberg News on the 14th.
According to the report, Chinese officials are reviewing this option as a potential measure in preparation for the so-called 'TikTok Ban Act' set to take effect in the U.S. starting on the 19th.
Currently, Chinese authorities strongly desire TikTok to remain under the ownership of its parent company, ByteDance. However, the opposition lawsuits filed in U.S. federal courts following the passage of the TikTok Ban Act have been lost in both the first and second trials, and the remaining prospect of the Supreme Court granting an injunction to halt the law's enforcement is not promising. During oral arguments at the Supreme Court on the 10th, justices remarked, "Everyone knows that China is behind TikTok," signaling the imminent enforcement of the law.
Accordingly, Chinese senior officials have begun reviewing the TikTok issue as part of broad discussions aimed at cooperating with the upcoming Trump administration, sources explained. Among the scenarios currently under discussion is a joint management approach in which Musk's platform X (formerly Twitter) would take control of TikTok.
The report assessed that "a potential deal with Musk, a close ally of Trump, could be somewhat attractive to Chinese authorities." From China's perspective, using Musk?who will head the Office of Government Efficiency in the next administration?as a channel could be a gesture of reconciliation toward President-elect Trump. A source stated, "TikTok's fate may no longer be solely under ByteDance's control," adding, "Chinese officials recognize that the second Trump administration will face tough negotiations involving high tariffs and export controls, and they see TikTok as a potential area for reconciliation."
For Musk as CEO, TikTok, with its 170 million users in the U.S., could serve as a base to expand advertising on the X platform. It would also enable his AI company xAI to utilize the vast data accumulated by TikTok. Previously, in April last year, Musk stated, "Personally, I think TikTok should not be banned in the U.S., even if such a ban might benefit X. It conflicts with freedom of expression and does not align with the values the U.S. pursues."
Chinese authorities have yet to reach a concrete agreement. Sources confirmed that the discussions are still in the early stages. Bloomberg noted uncertainties regarding how much ByteDance, TikTok, or Musk are aware of these governmental considerations or whether such discussions have taken place between Musk and TikTok. Neither Musk's representatives, ByteDance, TikTok, nor China's Ministry of Commerce responded to Bloomberg's requests for comment.
Bloomberg also highlighted that Chinese authorities hold golden shares in ByteDance subsidiaries. Golden shares refer to a minority stake that grants the government special control over major corporate decisions. TikTok claims that these golden shares apply only to its Chinese affiliate, Douyin Information Service, but the structure inevitably gives the Chinese government significant influence over TikTok as well.
According to Bloomberg Intelligence, the U.S. TikTok business is valued at approximately $40 billion to $50 billion, a scale that could be burdensome even for Musk, the world's richest person. Bloomberg noted, "It is unclear how Musk would complete this deal, whether he would need to sell other stakes, or if the U.S. government would approve it," adding, "Twitter, acquired by Musk in 2022, was valued at $44 billion and still carries substantial debt." The complexity of spinning off the U.S. business itself is expected to have significant impacts on shareholders in both China and the U.S.
President-elect Trump, who is set to be inaugurated on the 20th, has requested the Supreme Court to postpone the ban deadline so that the TikTok issue can be resolved during his term. A TikTok official, speaking anonymously, said that management is still focusing on legal battles such as those at the Supreme Court and prefers to continue fighting within the U.S. rather than fully relinquishing control through a sale of the U.S. operations.
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