Trump Says MicroStrategy's Bitcoin Strategy Is an Alternative to Stock Buybacks
Trump is questioning stock buybacks, while MicroStrategy keeps stacking Bitcoin through share issuance. But the shrinking premium is making that strategy more vulnerable now.
Key Takeaways
- Trump criticized stock buybacks at defense companies and called them a fake way to push up share prices without real production gains.
- MicroStrategy is using share issuance to buy Bitcoin and now holds more than 845,000 BTC.
- MicroStrategy's premium and stock price have fallen, making this strategy less powerful.
President Donald Trump has once again criticized stock buybacks, especially at defense companies, calling them a fake way to boost share prices. At the same time, MicroStrategy's strategy shows there is another path to value gains, namely issuing new shares to buy Bitcoin.
Criticism of Stock Buybacks at Defense Companies
In January, Trump signed an executive order that bars major defense contractors like Lockheed Martin, Northrop Grumman, and RTX from buying back shares or paying dividends as long as their production does not improve. According to him, stock buybacks create an artificial price jump without building real capacity. He argues that the money would be better spent on investments in factories, equipment, and faster production.
This approach has sharpened the debate over how companies manage their own shares. While Trump is focused on cutting back stock buybacks, MicroStrategy is taking the opposite route.
MicroStrategy's Bitcoin Model Through Share Issuance
Instead of buying back shares, MicroStrategy issues new common and preferred shares to buy Bitcoin. This has led to a holding of more than 845,000 BTC, the largest of any publicly traded company. CEO Michael Saylor sees each capital raise as a way to increase the amount of Bitcoin per share.
This approach works like a flywheel: MicroStrategy sells shares above the value of its Bitcoin, buys more Bitcoin, and then increases the Bitcoin per share. That can help support a premium above net asset value. However, in 2026 that premium has shrunk because the Bitcoin price is hovering around $64,360, close to MicroStrategy's average purchase price.
The stock price has more than halved over the past year, leaving the company's market value at around $40 billion. When the premium shrinks, issuing new shares has less impact on value because dilution is less offset by price gains.
Why This Matters for Investors and the Crypto Market
The question for both investors and regulators is whether a company is actually creating value or just manipulating its stock price. For MicroStrategy, that depends on where Bitcoin goes next and whether it can move above the cost basis enough to restore the premium.
This strategy offers an alternative to traditional stock buybacks, tying growth and valuation to crypto holdings. For European investors, it can offer insight into how innovative financing models through share issuance and crypto investments can affect company valuations, especially in a market where regulation and capital allocation are under pressure.
MicroStrategy remains one of the most closely watched examples of a public company actively using its balance sheet for Bitcoin accumulation. In a recent update, Strategy once again increased its Bitcoin stash through a share sale, showing how sensitive this model still is to BTC's price and investors' willingness to keep funding it.
