WASHINGTON — On Monday, President Donald Trump enacted an executive order aimed at initiating the development of a government-owned investment fund. He indicated that this fund could be utilized to generate profits from TikTok, should a suitable American buyer be found.
In his first executive action, Trump had set a deadline for TikTok to secure a partnership or buyer by early April. He has expressed interest in the U.S. acquiring a 50% share of the popular social media platform, which is owned by the Chinese firm ByteDance. While addressing reporters in the Oval Office, Trump highlighted TikTok as a prime example of an asset that could be included in the new U.S. sovereign wealth fund.
“We might consider putting that in the sovereign wealth fund, or we could pursue a partnership with wealthy individuals—there are plenty of options,” he remarked regarding TikTok. “It’s just one of several assets we could potentially incorporate into the fund.”
Sovereign wealth funds typically invest in a range of assets including stocks, bonds, and real estate. These funds are often funded by budgetary surpluses, which the U.S. currently lacks. Trump pointed out that many countries maintain such funds, and he projected that the U.S. could eventually surpass even Saudi Arabia’s fund in size, stating, “Eventually, we’ll catch it.”
Worldwide, there are over 90 sovereign wealth funds that manage assets exceeding $8 trillion, as reported by The International Forum of Sovereign Wealth Funds, an organization located in London that comprises around 50 such entities. Within the United States, more than 20 sovereign wealth funds operate at the state level, as per research from the Center for Global Development, a nonpartisan think tank in Washington. The largest state funds—located in Alaska, New Mexico, and Texas—are supported by revenue from oil, gas, and mineral resources, which in turn fund various state programs such as education. Although these funds are government-owned, they typically run as independent institutions with distinct investment strategies and staff.
To oversee the establishment of this new fund, Trump appointed Treasury Secretary Scott Bessent and Howard Lutnick, his choice for Commerce Secretary. This initiative will likely need the approval of Congress to move forward. The previous administration under Joe Biden had also explored the option of creating a sovereign wealth fund with a focus on national security investments, though these considerations did not lead to tangible actions before his term ended.
Bessent stated that the goal for the administration is to launch the fund within the next 12 months, while Lutnick suggested that the fund may also be used for the government to acquire profit-generating stakes in vaccine manufacturers. “The extraordinary scale and resources of the U.S. government should generate value for American citizens,” Lutnick informed reporters.
Last month, a federal law threatening to ban TikTok unless ByteDance divested its stakes went into effect, following bipartisan passage in April. The law was signed by Biden, prompting legal challenges from the companies involved and several users, which were eventually upheld by the Supreme Court last month. Following his inauguration, Trump, who had sought to ban TikTok during his previous term, instructed the Justice Department to delay the law’s enforcement for 75 days. This extension granted the company additional time to negotiate with the administration.
Interest in purchasing TikTok’s U.S. operations has been voiced by several investors, including billionaire Frank McCourt and former Treasury Secretary Steven Mnuchin. Trump has also mentioned that “many people” have approached him about the potential acquisition privately, noting that Microsoft was among the companies interested in the social media platform.
Recently, a San Francisco-based AI startup named Perplexity AI submitted a proposal to ByteDance that would enable the U.S. government to hold up to a 50% stake in a combined entity of TikTok’s U.S. business and Perplexity’s operations. A source familiar with the discussions revealed that if the proposal were to succeed, the U.S. government could take a significant share in this entity following an initial public offering estimated at a minimum of $300 billion.
