TikTok ban: Can crypto survive without TikTok’s influence?
TikTok, the social media platform launched in September 2016, is facing a potential ban in the U.S. Will it affect the crypto market?
On Jan. 19, the ban on TikTok in the U.S. will go into effect under the Protecting Americans From Foreign Adversary Controlled Applications Act. This legislation would make it illegal for app stores – run by Google and Apple – and web-hosting services to distribute or service TikTok.
The social media application, which had an advertising revenue of $6.2 billion in the U.S. in 2023, has been asked by the Supreme Court to either sell the application or face a ban.
The law cites national security concerns as its main reason for the ban, fearing that the Chinese government might access user data collected by TikTok.
However, the crypto-friendly President-elect Donald Trump is looking for a decision to beat the ban. Trump even submitted a writ to save TikTok’s fate. Many Senators such as Ed Markey have also taken a stand against the ban.
On Jan. 10, the Supreme Court conducted the oral arguments on the matter, and a decision is likely to be handed down before the Jan. 19 deadline.
The outcome will decide whether TikTok will either continue with an operation under the present ownership in the U.S. or ByteDance, the parent company of TikTok, will be forced to divest to comply with a new law.
Crypto culture on TikTok
In Oct. 2024, the UK’s Financial Conduct Authority raised concerns regarding TikTok’s virtual gifting system. TikTok allows users to purchase TikTok Coins, which enables them to gift creators, as reported in Financial News.
TikTok Coins were converted into “diamonds,” which were then cashed out, similar to how crypto operates. The FCA, however, still has expressed worry over the risks involved with unregulated crypto activities, ranging from money laundering to inadequate consumer protection.
However, this is not the first time TikTok and crypto have joined hands. In fact, in December 2024, Sonic, a Solana (SOL) based gaming-focused layer-2 blockchain, chose TikTok as a platform to airdrop its SONIC token to all users onboarded through the social media app.
Sonic built its SonicX game directly inside TikTok, hoping to replicate the success of mini apps built on the Toncoin (TON) blockchain inside Telegram. The game gained over 2 million users through TikTok.
As per The Drum, social media marketers have often used TikTok to start reviving interest in cryptocurrencies with its sizeable space for creating content that simplifies complex ideas in graspable forms that engage a younger tech-savvy audience.
Further, in 2020, the viral #DogecoinTiktokChallange was launched, where crypto influencers pumped up Dogecoin (DOGE) by 20% in a week.
Could the ban impact crypto?
Alejandro Zambrano told crypto.news in a message that while unfortunate, a TikTok ban in the U.S. is “unlikely to affect the crypto market.”
Zambrano, who is the Chief Market Strategist at ThinkMarkets, a global online brokerage firm that offers services for forex, CFDs, and cryptocurrencies, stated that TikTok had been suppressing crypto-related content for years.Â
“TikTok has been suppressing crypto-related content for years, rendering its closure largely irrelevant to the industry. For instance, major crypto influencers on X previously experimented with TikTok but garnered limited views, leading them to stop posting on the platform. Moreover, the top TikTok accounts today attract significantly fewer views for similar content compared to leading influencers on X.”
Alejandro Zambrano, Chief Market Strategist at ThinkMarkets
To prohibit financial services and products, including cryptocurrencies, in Jul. 2021, TikTok amended its content policy in a bid to take a firm stand against misleading advice and high-risk investment schemes.
In light of the content ban that had already been imposed, it is less likely to have a major impact on the crypto sector if TikTok were to be completely banned in the U.S.
