A bipartisan bill demanding that ByteDance, the Chinese parent company of TikTok, divest the popular video-sharing app is rapidly advancing towards President Biden's approval. ByteDance, the world's most valuable venture capital-backed startup, owns TikTok entirely, with outside investors holding a 60% stake in ByteDance.

The proposed legislation doesn't constitute an outright ban on TikTok; instead, it requires ByteDance to establish TikTok, or at least TikTok US, as an independent entity with its stock, with ByteDance and its China-based employees collectively owning less than 20%.

The divestiture could occur through a sale, stock swap with existing investors, or an initial public offering (IPO). However, each option presents challenges, including potential high costs for even a small stake in TikTok and the current antitrust scrutiny, making Big Tech companies ineligible buyers.

Investors may need help completing an initial public offering (IPO) within the legislative timeframe. While some investors may resist forced divestiture, others could see it as a quick route to much-needed liquidity. There's also the possibility that ByteDance might refuse to divest, or Chinese government intervention could prevent it, potentially leading to a TikTok ban in the US.