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TikTok’s CEO Shou Zi Chew will testify before Congress on Thursday amid calls for the hugely popular app to be banned. There’s a chance the days of endlessly swiping through videos on the platform are numbered. So how did we get here? Alex Zhu and Luyu Yang originally launched an app called Musical.ly way back in 2014. It became especially popular in the U.S. among tweens and preteens who would use it to share videos of themselves lip syncing to songs. ByteDance, meanwhile, was already running TikTok, and seeing how popular Musical.ly was, bought the company for $1 billion in 2017. It merged the two apps in 2018, bringing all Musical.ly users over to TikTok and kickstarting what would become one of the world’s most popular social media platforms. But TikTok’s connection to China, coupled with the fact that it’s so popular with younger users, sent regulators and politicians in the U.S. and abroad into overdrive. The government’s beef with the app is over whether it’s shipping U.S. users’ data to China which then uses it to spy on Americans and spread pro-Beijing propaganda and disinformation. A number of states and federal agencies, not to mention the military, have banned the use of the app on official devices and networks. Key video takeaways 0:10 How TikTok controversy started 0:45 Calls for TikTok to be banned 1:10 U.S. Govt.’s main beef with TikTok
A potential government ban on TikTok will once again be in focus this week as the company’s CEO, Shou Zi Chew, will testify before Congress on Thursday. Steve Pavlick, Renaissance Macro Research Head of Policy, notes there are several ways TikTok usage could be tailored by the U.S. government. One solution would be spearheaded by the Commerce Department, which could ban the use of TikTok in the U.S through restricting app downloads and limiting its role in commerce, Pavlick wrote recently. The Committee on Foreign Investment in the U.S. (CFIUS), would lead the other charge. Regardless of the path to the limitations, Pavlick believes TikTok, which just eclipsed 150 million monthly active users, should be banned in the U.S. Social media stocks have popped on such speculation over the past month. Shares of Meta (META), Snap (SNAP) and Pinterest (PINS) have all risen over the last several weeks as the notion of banning TikTok has gained bipartisan support. In the video above, Pavlick joins Yahoo Finance's Dave Briggs and Seana Smith to explain why he believes TikTok should be banned. Key video moments: 0:00:05 - The case for a ban
Snap (SNAP) closed at $10.66 in the latest trading session, marking a -0.37% move from the prior day.