Trump establishes sovereign wealth fund with potential plans to acquire TikTok

In a groundbreaking move, President Donald Trump signed an executive order on Monday outlining plans for a U.S. government-run sovereign wealth fund. The fund, envisioned as an economic development tool, could potentially be used to acquire the social media platform TikTok.

Sovereign wealth funds are typically employed by smaller nations with abundant natural resources and fiscal surpluses. Countries like Norway, China, and Singapore have long leveraged such funds to invest in infrastructure, financial markets, and strategic assets. The United States, however, has historically relied on Treasury debt issuance rather than a sovereign wealth fund to raise money. Trump's initiative marks a departure from this norm, aiming to "monetize the asset side of the U.S. balance sheet for the American people," according to U.S. Treasury Secretary Scott Bessent.

“We’re going to stand this thing up within the next 12 months,” Bessent stated during a media briefing. “There’ll be a combination of liquid assets and other resources that we have in this country as we work to bring them out for the American people.”

The executive order outlines a broad scope for the fund, including investments in infrastructure such as airports and highways, as well as efforts to extend U.S. economic influence in regions like Panama and Greenland. Additionally, President Trump has suggested that the fund could support “great national endeavors,” possibly including the acquisition of TikTok, which has been under scrutiny due to national security concerns.

TikTok, which briefly faced a ban in the U.S., has been granted a 75-day period to restructure its ownership and divest from Chinese interests. The U.S. government could potentially become a stakeholder through the new sovereign wealth fund, further increasing its financial and strategic influence in the digital space.

The executive order also identifies potential funding mechanisms for the initiative. While traditional sovereign wealth funds are often financed by revenues from natural resources, financial transactions, and carbon taxes, Trump has suggested that tariffs could play a role in funding the U.S. fund.

Norway’s sovereign wealth fund, currently the largest in the world, holds assets exceeding $1.7 trillion, followed by China’s Investment Corporation with approximately $1.3 trillion in holdings. These funds invest in a mix of stocks, bonds, real estate, infrastructure, and private equity, allowing nations to exert financial influence on a global scale.

A U.S. sovereign wealth fund could help the country compete with other major economies, potentially reducing reliance on Treasury debt. However, critics caution that such funds require strict governance to ensure transparency and prevent conflicts of interest or corruption.

The executive order tasks Treasury Secretary Scott Bessent and Commerce Secretary nominee Howard Lutnick with developing a strategy within 90 days to operationalize the fund. As details emerge, questions remain regarding how the fund will be managed, its sources of revenue, and whether it will face resistance from Congress or financial experts wary of government-controlled investment strategies.

While the concept of a U.S. sovereign wealth fund is not new, Trump’s bold move could redefine how the federal government approaches fiscal sustainability, economic security, and international financial influence. Whether this initiative proves successful or faces significant hurdles remains to be seen, but it undoubtedly marks a shift in the nation’s economic strategy.