US and China Reach Preliminary Agreement on TikTok Amid Trade Negotiations
The United States and China have reportedly reached a framework agreement regarding the future of social media platform TikTok, according to Treasury Secretary Scott Bessent. The announcement was made during a bilateral meeting in Madrid focused on economic policy discussions between the two countries.
Bessent clarified that the deal is between private entities but that the commercial terms have been settled. This development comes just days before the US government’s deadline to potentially ban the app on September 17, 2025.
Political Context and Implications
President Donald Trump acknowledged the deal on his social media platform, Truth Social, describing it as involving a “certain” company that is especially popular among young Americans. Trump also indicated plans to discuss the matter further with Chinese President Xi Jinping later in the week.
The timing of the agreement is significant, as it coincides with intensified US-China negotiations on tariffs and technology restrictions. Reuters had reported earlier on the day of the announcement that the US was prepared to ban TikTok if China did not relent on demands for tariff reductions and easing of technology constraints.
Background on TikTok’s US Regulatory Status
TikTok has been a focal point of US national security concerns, leading to a ban enacted on January 19, 2025, under legislation signed by former President Joe Biden. However, the app’s operation in the US has been maintained through a series of executive orders signed by President Trump since taking office.
Trump had previously indicated in June 2025 that a group of buyers had been identified to take over TikTok’s US operations, suggesting a path forward to address data security and ownership concerns.
Outlook
While the framework deal marks progress in resolving TikTok’s contentious status in the US, details remain limited and the final agreement will require further negotiation and regulatory approval. The evolving geopolitical and economic context between the US and China will continue to influence the outcome.
FinOracleAI — Market View
The announcement of a framework deal on TikTok between the US and China is likely to be viewed positively in the short term, as it reduces uncertainty over the app’s potential ban in the US market. Key drivers include the easing of regulatory risks and the potential stabilization of US-China tech relations amid broader trade negotiations. However, risks remain from unresolved details and the geopolitical environment, which could affect final implementation. Market participants should monitor subsequent discussions between the two governments and any regulatory filings related to the deal.
Impact: positive
