Ethereum News Today: Pierre Rochard Slams ETH and XRP Tokenization as 'Taxing the Poor'

Bitcoin maximalist Pierre Rochard has launched a sharp critique of the tokenization thesis, particularly targeting Ethereum (ETH) and XRP, suggesting that the model will end up "taxing the poor." Rochard, known for his vocal advocacy of Bitcoin, posted his views on X, questioning whether Ethereum and XRP can meaningfully improve the settlement system for securities [1]. His argument centers on the idea that the value proposition of these blockchains—relying on securities issued on their networks and transaction fees burned to benefit token holders—is fundamentally flawed [1].

Rochard identified two primary challenges undermining this thesis. The first is the entrenched role of traditional institutions like the Depository Trust and Clearing Corporation (DTCC), which controls a significant portion of U.S. securities trades. As a member-owned cooperative, DTCC has little incentive to adopt a fee-burning model that would reduce its profit margins [1]. Rochard also noted that existing exchanges such as ICE and Nasdaq already offer efficient and low-cost services, leaving little room for Ethereum or XRP to gain traction on cost-based competition [1].

The second challenge, according to Rochard, stems from the open-source nature of blockchain technology. He argues that new networks can easily replicate and outcompete Ethereum and XRP, driving fees down further. As evidence, he highlighted that the largest volume of tokenized trading currently occurs on Tron, via Tether’s USDT, rather than on Ethereum or XRP networks [1]. Rochard’s broader concern is that the tokenization model ends up extracting fees from the world’s poorest investors, who have the least capacity to afford such costs [1].

The debate attracted responses from other crypto participants. Analyst David Simic contended that Ethereum’s liquidity and security provide natural barriers to competition [1]. Rochard, however, dismissed this by arguing that tokenized assets are inherently different from native blockchain assets like Bitcoin, as issuers can often freeze or reverse transactions, shifting control back to legal authorities [1]. He used Tether’s use of Tron as an example, suggesting that legal oversight—not blockchain immutability—is what ultimately matters in such systems [1].

Supporters of blockchain-based settlement argued that the technology offers faster, more transparent, and less risky alternatives to traditional systems. A participant using the name Wholistic pointed out that legacy systems suffer from counterparty risks, require collateral at clearinghouses, and rely on outdated infrastructure [1]. Rochard countered that blockchain is not necessary to solve these inefficiencies and that tokenized securities are not the same as bearer assets like Bitcoin [1].

Rochard’s critique has contributed to broader skepticism about the real-world utility of tokenization, particularly in the context of financial inclusion. While proponents argue that blockchain can democratize access to investment opportunities, critics like Rochard see it as a system that disproportionately benefits the powerful while placing the burden on less wealthy participants [1].

Source: [1] ETH and XRP Will Tax the Poor: Pierre Rochard Slams Tokenization Thesis (https://coinedition.com/eth-and-xrp-will-tax-the-poor-pierre-rochard-slams-tokenization-thesis/)