President Donald Trump has again branded stock buybacks a fake way to lift share prices, yet the MicroStrategy Bitcoin model points to a different route to higher valuations, one built on issuing shares rather than repurchasing them.
His latest comments target defense contractors. They also sharpen a wider debate over how companies move their own stock, through buybacks that shrink share counts or through dilution that funds a growing bitcoin treasury.
What Trump Said About Buybacks
Trump has renewed pressure on defense firms over how they use their cash. He signed an executive order in January that bars underperforming contractors from buybacks and dividends until production improves.
His argument is direct. Repurchases inflate share prices without building real capacity, so he wants the money spent on plants, equipment, and faster output.
The policy targets large contractors such as Lockheed Martin, Northrop Grumman, and RTX. Trump has returned to the theme this week, and his buyback comments have rattled defense stocks before.
How the MicroStrategy Bitcoin Model Works
MicroStrategy (now Strategy), takes the opposite path. It does not repurchase common stock. It sells new shares and preferred stock, then spends the cash on Bitcoin.
That dilution and debt approach has built a stockpile of more than 845,000 Bitcoin (BTC), the largest held by any public company.
Michael Saylor frames each raise as a way to grow Bitcoin per share. Those purchases now represent more than four percent of all BTC in circulation.
The company has even bought back debt, repurchasing convertible notes at a discount this year. It has also leaned on preferred stock issuance to keep buying without adding senior loans.
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Why the Premium Decides Everything
The model works through a flywheel. MicroStrategy issues stock above the value of its coins, buys more bitcoin, and lifts holdings per share, which can support a premium over net worth.
That premium has thinned in 2026. With Bitcoin trading near $64,360, the holdings sit close to the average price MicroStrategy paid.
The stock has fallen by more than half over the past year, and its market value has slipped toward $40 billion.
When the premium fades, new share sales add little value. The same dilution that powered gains now offers thinner support, a pattern visible during the recent Bitcoin sell-off pressure.
Both stories turn on one question. Investors and regulators want to know whether a company builds value or simply moves its share price.
For MicroStrategy, the answer may rest on whether Bitcoin climbs back above its cost and revives the premium.
