TikTok's deal to sell off its US business to Oracle and Walmart has been indefinitely suspended, sources told the Wall Street Journal.
Sources said the deal has been shelved as the Biden administration takes stock of whether it wants to enforce the sanctions against TikTok put in place by former President Donald Trump.
In August 2020 Trump signed two executive orders demanding TikTok divest its US operations to an American company, claiming the app was a national security risk as its parent company ByteDance is headquartered in China.
The orders were met by legal challenges from TikTok, which successfully managed to prevent Trump from blocking the app for US users.
Oracle and Walmart announced their intention in September to take a majority stake in a new US spin-off called TikTok Global.
Per the Journal, TikTok's parent company ByteDance has continued discussion with US security officials, but it is not yet certain which way the Biden administration might lean.
One source said it's possible TikTok will arrive at a deal with the Committee on Foreign Investment in the US (CFIUS) where it would have a third party to manage its US data, thereby avoiding a sale.
Sources also said it's still possible Oracle and Walmart will feature in a deal, but the size of their role would depend on how many of Trump's actions against TikTok the Biden administration chooses to uphold.
"We plan to develop a comprehensive approach to securing US data that addresses the full range of threats we face," National Security Council spokeswoman Emily Horne told the Journal.
"This includes the risk posed by Chinese apps and other software that operate in the US In the coming months, we expect to review specific cases in light of a comprehensive understanding of the risks we face," she added.
TikTok has maintained its parent company's Chinese roots do not pose a security risk to US users, as its user data is stored on servers outside of China. TikTok itself is not available in China, as it is essentially an international clone of its Chinese sister app Douyin.
Two deadlines relating to Trump's orders are coming up next week, meaning it's likely the scope of TikTok's deal will start to crystallize soon.
Oracle declined to comment on the Journal's report when contacted by Insider. TikTok and Walmart were not immediately available for comment.