This comes after Trump on Friday threatened to ban the app within the United States with administration officials expressing security concerns in recent weeks.
The deal would see Microsoft taking ownership of the platform in the United States, Canada, Australia, and New Zealand.
"A US company should buy TikTok so everyone can keep using it and your data is safe", he said in a tweet, "With TikTok in China, it's subject to Chinese Communist Party laws that may require handing over data to their government".
A USA investigation into ByteDance Ltd's TikTok is really meant to smother a Chinese-owned app that's become a sensation with Americans, founder Zhang Yiming told employees in China on Tuesday (Aug 4).
CFIUS has been reviewing ByteDance Ltd.'s 2017 purchase of the lip-synching app Musical.ly that was later folded into TikTok. If TikTok was to be acquired by Microsoft in the United States, the people said that the algorithms would likely diverge over time. "You sign up for a Chinese app like TikTok, they get your user name and password, maybe if you use that across other applications, they've got that", he said.
Also on Monday, White House trade adviser Peter Navarro suggested that Microsoft could shed its holdings in China if it buys TikTok's USA business. India's recent decision to ban TikTok and other Chinese apps have stirred a national debate in the U.S. and there has been increasing demand in America to follow suit.
TikTok is valued at about $50 billion, according to some investors.
But Trump also threw a surprise new condition in any deal, saying the sale of TikTok's US business would have to result in a significant payout to the US Treasury for initiating it.
"Instead, I think this is part of the splintering of the Internet into competing national networks", Lemley said. We make it possible to have this great success. "But we deserve to have big percentage of price coming to Treasury".
Chinese media first reported the contents of the internal letter.
"In light of the current situation, ByteDance has been evaluating the possibility of establishing TikTok's headquarters outside of the US, to better serve our global users", the company said.
He said the national security grounds for the US's clampdown on Chinese firms "does not hold water", adding that the companies conduct their business activities in accordance with worldwide rules and USA laws.
The Global Times, which is another Chinese government mouthpiece, reported in May that China could put Apple on an "unreliable entity list" alongside other USA companies, in a series of punitive countermeasures the country was prepared to take against US moves to block Taiwan-based TSMC from selling chips to Huawei for its phones.