Social media giants Snap (SNAP) and Meta Platforms (META) ticked up higher in pre-market trading on Thursday after reports that the U.S. may ban TikTok unless the Chinese tech giant ByteDance divests its stake.
TikTok has been facing rising scrutiny in the U.S. as many lawmakers have argued that the app poses a threat to national security due to its ownership by ByteDance. TikTok responded to this news by stating that “a forced sale wouldn’t address the perceived security risk” and that the popular social media app was planning to spend $1.5 billion on data and content protection when it came to users in the U.S.
Meanwhile, the United Kingdom has already announced that it plans to ban TikTok on government devices. However, this ban would not extend to the personal devices of government employees.
The Global X Social Media ETF (SOCL) is down by around 19% in the past year.