TikTok US Sale Delay Risks Full App Ban

TikTok's immediate future in the United States is once again uncertain. With a deadline now just 57 days away, a leading investor has withdrawn from the proposed sale, intensifying the risk of a ban that could impact millions of creators and small brands who rely on the platform, as outlined in Social Media Today's coverage.

The Chinese-owned platform must be sold to a U.S.-based buyer by September 17 to comply with the "Protecting Americans from Foreign Adversary Controlled Applications Act." Although President Trump previously indicated that a deal was close—pending Chinese approval—negotiations have stalled.

Blackstone, a private equity firm, has exited the bidding consortium, according to Reuters. The group seeking to acquire TikTok's U.S. assets included Susquehanna International Group, General Atlantic, KKR, Andreessen Horowitz, and Oracle. Their plan aimed to form a "TikTok U.S." subsidiary owned primarily by American investors, with ByteDance, TikTok's parent company, retaining only a minority share.

The main proposed arrangement was:

U.S. investors would own 80% of TikTok's American operations

ByteDance would hold a small minority stake

A new U.S. entity would operate the app to satisfy national security requirements

Blackstone's sudden exit leaves the remaining investors scrambling to adjust their bid, raising uncertainty over whether the deal can close before the government’s new deadline.

This is the latest chapter in a saga that has seen multiple deadline extensions and ongoing pressure from trade negotiations. Despite TikTok technically being in violation of U.S. law, the app continues to run pending discretion from the White House.

Now, there are increasing signs that the White House plans to strictly uphold the “Protecting Americans from Foreign Adversary Controlled Applications Act" deadline. According to U.S. Commerce Secretary Howard Lutnick, the U.S. government is planning to implement a full ban on TikTok in America if a deal for its sale cannot be finalized by September 17th. Lutnick told CNBC that TikTok will “go dark” on that date if China refuses to agree to a sale to a U.S. entity.

“We’ve made the decision. You can’t have Chinese control and have something on 100 million American phones,” Lutnick said.

Lutnick further stressed that U.S. interests must gain control of both the app and its algorithms in order to satisfy the terms required. Reports indicate that the algorithm is a major sticking point, with the Chinese government unwilling to negotiate on the source code—and a TikTok without its core algorithm would be a fundamentally different platform. U.S. officials are pushing hard to include control of the algorithm in any eventual deal.

The risk of a forced shutdown is not new. Since 2020, TikTok has been at the center of the U.S.-China technology dispute, targeted by lawmakers concerned about data security and foreign influence. Past attempts at a sell-off fell through after political hurdles and resistance from Beijing. Despite Trump’s recent claims of having a buyer ready for a deal, the exit of a key partner and continued disagreement on critical terms means that negotiations are as fluid as ever.

Some reports have emerged suggesting that TikTok may be working on a U.S.-only version of the app as a potential fallback, although TikTok has denied this is happening. If the deadline is missed, Lutnick has indicated that the administration will enforce the ban; there are no indications of another extension.

For creators and brands, this repeated uncertainty introduces major risks. Many depend on TikTok for income, audience growth, and direct engagement. Previous TikTok shifts, including new features to credit songwriters, have shown how platform changes rapidly affect monetization and reach.

A ban or disruption to TikTok’s U.S. presence would send creators scrambling to alternative platforms like Twitch and Instagram that are now aggressively targeting short-form video audiences. Brands may also shift ad dollars if regulatory risk makes TikTok unreliable for campaigns with U.S. audiences.

At this point, with the main U.S. bidding group weakened, the U.S. government taking a firmer stance, and trade tensions intensifying, a smooth resolution is looking less likely. As Lutnick's recent remarks make clear, “maybe four extensions of the deadline will be too many, even for Trump and his personal affections for the app.” If a ban is enforced, it could set a precedent for other regions to follow the United States’ lead, given ongoing concerns that TikTok could be leveraged for state-backed influence or cybersecurity threats.

All eyes will remain on the U.S. government as the September deadline approaches. In the meantime, creators and marketers should prepare backup strategies, diversify their social footprints, and monitor official updates for shifts in policy or enforcement.