Elon Musk Proposes a ‘Hostage’ Exchange: If the U.S. Allows TikTok to Operate in the U.S., He Wants China to Legalize X

In 2020, President Donald Trump supported banning TikTok on U.S. soil due to concerns over the risk of user data falling into China’s hands. However, the situation has dramatically changed in 2025. The very person who wanted to eliminate TikTok has now positioned himself as its greatest defender. Trump’s argument centers on the principle of freedom of expression, which brings X owner Elon Musk into the picture.

The TikTok drama. The First Amendment guarantees freedom of speech and prevents government interference. However, this principle challenges several decrees enacted in red states like Montana, as well as the Protecting Americans from Foreign Adversary Controlled Applications Act signed by the Biden administration. The act prohibits companies from other countries from collecting data from American users and storing it outside the U.S.

As a result, ByteDance, the parent company of TikTok (as well as apps like Marvel Snap and CapCut), can’t operate in the U.S. without partnering with an American company. Trump recently issued an executive order that delays the TikTok ban for another 75 days.

Freedom of speech. Since acquiring X, Musk has described himself as a champion of free speech in the U.S. Interestingly, he’s publicly opposed banning TikTok in the country. In April 2024, he said, “In my opinion, TikTok should not be banned in the USA, even though such a ban may benefit the X platform.”

Months later, Musk elaborated on his stance: “I have been against a TikTok band for a long time because it goes against freedom of speech. That said, the current situation where TikTok is allowed to operate in America but X is not allowed to operate in China is unbalanced. Something needs to change.”

Legal priorities. The TikTok ban isn’t primarily about freedom of speech or content moderation. Instead, the ban is based on national security concerns and users’ privacy, stemming from the fact that the app allows data to be stored on servers in countries deemed “enemies.” By lifting the ban, Trump prioritizes freedom of expression but allows China to continue collecting data from TikTok users in the U.S.

China also has its own priorities. According to the Financial Times, Musk is asking that X be permitted to function in China in exchange for allowing TikTok to continue operating in the U.S., circumventing the country’s strict censorship regulations.

China’s response. Chinese foreign ministry spokesperson Mao Ning told the outlet that Beijing welcomed any company that complied with its laws. Additionally, she emphasized that Chinese entities operating abroad must adhere to local legal requirements.

Mao also said that Chinese companies abroad should “decide independently” regarding financial operations and deals. She clarified that the choice to sell or keep the U.S. division of ByteDance active rests solely with the company, not with the Chinese government.

A different approach. Musk’s demands toward China have been notably softer than those for other countries that have previously banned X. Examples include European nations, Brazil, and Australia, where local laws require platforms to combat misinformation and fake news.

Unlike his confrontational stance with Germany, Musk’s conciliatory tone toward Chinese authorities may stem from his role as an intermediary between China and the U.S. in recent months. He’s even been mentioned as a potential buyer of TikTok, a claim that the company quickly denied.

Communication between representatives of the Chinese government and Musk continues.

Tesla heavily relies on China. Musk’s cautious approach in addressing China also stems from the conflict of interest posed by the Asian nation’s impact on Tesla’s sales.

In the third quarter of 2024, nearly a quarter of Tesla’s sales originated from China. Meanwhile, the Shanghai plant also supplies exports to other Asian countries. China’s strategic role means that Musk can’t afford to alienate Chinese leaders. In an unusual move, Chinese VP Han Zheng attended Trump’s inauguration.

Before the inauguration, Han met with Musk. State-run Xinhua News Agency reported, “Han met with Chief Executive Officer of Tesla, Elon Musk, and welcomed U.S. companies including Tesla to seize opportunities and share the fruits of China’s development, and make new and greater contributions to closer economic and trade ties between China and the United States. Musk said that Tesla is ready to deepen investment in and cooperation with China, and play a positive role in promoting U.S.-China economic and trade interactions.”

Image | Trevor Cokley

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