On Monday, President Donald Trump signed an executive order instructing the U.S. Treasury and Commerce departments to begin the process of establishing a sovereign wealth fund.

Treasury Secretary Scott Bessent anticipates that the fund could be up and running within the next year, with the goal of financing significant government projects and strategic investments in critical areas like supply chains.

Trump indicated that the fund might be utilized for substantial infrastructure initiatives, such as highways and airports, in addition to investments in advanced defense capabilities and medical research.

The president also hinted at the possibility of leveraging the fund to assist in the acquisition of TikTok, suggesting it might either be a direct purchase or a collaboration with affluent individuals.

While he provided no specific details, he stressed that the success of the deal would depend on securing the right arrangement.

Previously, Trump had mentioned the idea of the U.S. taking a 50 percent share in TikTok through a joint venture, a proposal that has raised concerns regarding its legality.

Moreover, Trump's nominee for Commerce Secretary, Howard Lutnick, proposed that the sovereign wealth fund could also invest in companies that hold significant government contracts, including those engaged in COVID-19 vaccine production.

This initiative mirrors similar discussions among Democrats, who have also contemplated the establishment of a sovereign wealth fund.

Sovereign wealth funds are substantial pools of capital managed by governments and have played a key role in funding investments around the world, especially in the Middle East and Europe.

Nonetheless, there are still uncertainties about how the timeline for the new U.S. fund synchronizes with the ongoing discussions regarding the status of TikTok, which is facing scrutiny over national security issues.

The White House has yet to release additional information regarding the executive order.