Republican hardliners on China are anticipated to cautiously endorse President Trump’s initiative to preserve TikTok in the United States, albeit with ongoing apprehensions regarding national security, according to sources from On The Money.
This week, key Republican officials received a briefing on the president’s plan for a new U.S.-controlled entity that will manage the immensely popular yet contentious short-form video application, focusing in particular on how it will govern the essential recommendation algorithm.
During the private session, administration representatives informed lawmakers and their aides about a revised ownership model that aims to eliminate any potential Chinese spyware related to the algorithm, thereby securing the new TikTok for American users—a crucial step to align with legislation that mandates the app’s prohibition should there be any form of Chinese oversight.
As reported by The Post, the revamped TikTok algorithm will be a variant of the Chinese algorithm owned by ByteDance, which will undergo reconfiguration by Oracle, the tech firm co-founded by billionaire supporter Larry Ellison.
Nonetheless, staff members on Capitol Hill express doubts about whether the modified algorithm can be completely insulated from Chinese surveillance, especially considering certain complex details unveiled during the briefing, according to insiders. Notably, the algorithm remains in China’s possession and will be leased to the newly formed U.S. company.
“From a national security perspective, this isn’t ideal,” remarked an individual familiar with the briefing. “The algorithm will be rented from the Chinese entity to the U.S. TikTok for a decade, and Oracle won’t have total authority over its modifications.”
A representative for Oracle did not provide immediate comments, nor did a spokesperson for Trump.
In light of the algorithm concerns, various lawmakers worry that the Chinese could emerge as the primary beneficiaries of this arrangement, potentially earning up to 50% of the new entity’s profits due to ByteDance retaining a 20% stake in the venture, coupled with the costs linked to the algorithm licensing agreement with ByteDance.
Indeed, the expenses associated with the algorithm, financed through TikTok’s revenues, have diminished the anticipated valuation of the new entity from $40 billion to around $16 billion.
Oracle is set to provide Congress with further details in the coming weeks, and hearings may be scheduled in the not-so-distant future. American lawmakers are hesitant to oppose President Trump, who purportedly views the TikTok agreement as pivotal to his broader trade negotiations with China.
“I don’t believe this is an issue anyone within the Republican Party will strongly resist, given how much the president backs this deal,” commented a source close to the GOP’s hawkish faction on China.
Charlie Gasparino is attuned to the intersection of business, politics, and finance
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Insiders indicate that the interpretation of the Congressional ban law’s notion of “control”—in regards to ownership and the algorithm—primarily rests with the president. Trump and Vice President JD Vance, instrumental in finalizing the new TikTok framework, are confident that the U.S. security measures meet legal requirements.
Previously, Trump expressed strong opposition to TikTok during his initial term, attempting to ban the app, suspecting it was a tool used by the CCP for espionage. However, his stance has shifted; he now credits his 2024 electoral success in part to utilizing TikTok for pro-MAGA outreach.
In April 2024, former President Biden enacted bipartisan legislation prohibiting TikTok from U.S. app stores unless it relinquished Chinese oversight. Trump has implemented executive orders to delay the ban until a new arrangement for TikTok could be established, with that agreement finalized last Thursday.
