What we know about the Trump administration’s plans for a sovereign wealth fund

The U.S. Treasury and Commerce Departments have announced plans to establish a sovereign wealth fund following a new executive order signed by President Donald Trump. This state-owned investment fund, which typically consists of various financial assets such as stocks and bonds, may potentially be used to finance the acquisition of popular social media platform TikTok.

President Trump mentioned during a press conference on Monday that the sovereign wealth fund could serve as a means to facilitate a deal involving TikTok, although the specifics of this potential transaction remain uncertain. Trump expressed optimism about the fund’s potential, stating that it could become one of the largest funds in existence within a short period of time.

Countries like Norway and Saudi Arabia have successfully utilized sovereign wealth funds for economic development and investment purposes, and several U.S. states have similar funds in place. Secretary of the Treasury Scott Bessent emphasized the strategic importance of establishing a sovereign wealth fund, noting that it has the potential to create significant value.

Bessent, along with Commerce Secretary nominee Howard Lutnick, have been tasked with developing a plan for the creation of the fund within the next 90 days. This proposal will outline funding mechanisms, investment strategies, fund structure, and a governance model. While more details about the sovereign wealth fund are forthcoming, it remains to be seen whether Congress will approve its establishment.

President Trump has previously expressed interest in leveraging revenue from tariffs to fund a sovereign wealth fund that could support infrastructure projects and research initiatives. Legislation introduced by Rep. Morgan McGarvey in 2024 aimed to explore the possibility of creating a sovereign wealth fund in the U.S.

Regarding TikTok, President Trump has engaged in discussions with potential buyers for the app, which faced a temporary ban in January due to national security concerns. The Supreme Court upheld the ban, citing the app’s data collection practices and its relationship with a foreign adversary. However, Trump signed an executive order delaying the ban for 75 days to allow for further evaluation of national security implications.

As the future of TikTok and the sovereign wealth fund unfolds, it is clear that these developments have significant implications for the economic and technological landscape of the United States. Stay tuned for further updates on these evolving developments.