The Chinese government is considering a contingency plan involving Elon Musk acquiring TikTok’s U.S. operations to prevent the app from being effectively banned, Bloomberg News reported on Monday.
This strategy is among several options being explored by China as the U.S. Supreme Court deliberates whether to uphold a law requiring China-based ByteDance to divest TikTok’s U.S. business by January 19, according to anonymous sources cited in the report.
Should that deadline pass without compliance, third-party internet service providers could face penalties for supporting TikTok’s operations in the United States, CNBC added.
According to Bloomberg, the proposal would have Elon Musk manage both his current platform X and TikTok’s U.S. operations. However, Chinese government officials have not yet decided whether to move forward with this preliminary plan.
The report noted that it remains unclear if ByteDance is aware of the Chinese government’s plans or of the discussions involving TikTok and Musk. Senior Chinese officials are reportedly weighing various contingency strategies for TikTok’s future in the U.S. as part of broader talks involving President-elect Donald Trump.
A TikTok spokesperson said in an email to CNBC, “We can’t be expected to comment on pure fiction.” X didn’t immediately respond to a request for comment.
Last week, the Supreme Court heard oral arguments regarding a law that could ban TikTok, signed by President Joe Biden in April. TikTok’s legal team argued that the law infringes on the free speech rights of millions of U.S. users, while the U.S. government maintained that ByteDance’s ownership of TikTok presents a national security risk.
As the Supreme Court appears inclined to side with the government, TikTok might seek assistance from President-elect Trump when his second term begins on January 20. Although Trump supported a TikTok ban during his first administration, his stance has since shifted.
Late last month, he called on the Supreme Court to intervene and delay the enforcement of Biden’s ban, aiming to buy time for a potential “political resolution.”
Trump’s stance on TikTok began to shift after his February meeting with billionaire Jeff Yass, a Republican megadonor and major investor in ByteDance who also holds a stake in the owner of Truth Social, Trump’s social media company, CNBC reported.
Earlier this month, the outgoing Securities and Exchange Commission Chairman Gary Gensler threatened to press charges against Tesla and Space X CEO Elon Musk if he does not comply with a monetary demand.
The billionaire entrepreneur posted a letter that showed he could face charges that date back to his purchase of Twitter, now known as X, in 2022 with the caption, “Oh Gary, how could you do this to me?”
A letter from Musk’s attorney, Alex Spiro, to Gensler said that the X boss had been informed that he had to “agree within 48 hours to either accept a monetary payment or face charges on numerous counts.”
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The attorney said that the demand was regarding “certain purchases, sales and disclosures of Twitter shares” and was another in a long line of what he said was “more than six years of harassment of Mr. Musk by the Commission.”
“We demand to know who directed these actions — whether it was you or the White House,” he said in the letter.
The SEC responded to the CEO’s claims in a message to The New York Post.
“It is the policy of the SEC to conduct investigations on a confidential basis to preserve the integrity of its investigative process,” it said. “The SEC therefore does not comment on the existence or nonexistence of a possible investigation.”
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