Author｜jk, Odaily Planet Daily
The rise of VanEck, an investment company focused on ETFs, is full of bold innovations and strategic decisions. From the launch of the gold ETF to the recent Solana ETF, VanEck continues to break through itself and promote changes in the financial market. With the rapid development of the cryptocurrency market, VanEck has been at the forefront of the industry and applied for the Solana ETF, opening up new investment areas for investors.
In this article, Odaily Planet Daily will delve into VanEck’s past history and its decision from gold ETF to Solana ETF.
History of VanEck
In 1955, John van Eck founded Van Eck Global to take advantage of the growing international stock markets in the context of the opening of Western Europe to American investors after the Marshall Plan, aiming to bring post-World War II investment opportunities to American investors. His father emigrated to the United States from the Netherlands in the early 20th century. That same year, Van Eck established the first international equity mutual fund.
In 1968, the company launched the International Investors Gold Fund, one of the first gold funds in the United States, and shifted most of its portfolio to stocks of gold mining companies. From the 1970s to the mid-1980s, gold experienced a bull market and the company achieved remarkable success. The International Investors Gold Fund attracted a large number of subscriptions and managed assets of more than $1 billion. John van Eck was invited to participate in famous talk shows at the time, such as Wall Street Week and The Merv Griffin Show.
1980s to early 2000s: Lows
However, after the mid-1980s, the gold market boom ended and the company's business slowed. By February 1998, the assets of the International Investors Gold Fund had shrunk to $250 million. John's son Jan said, "He became a gold fanatic. Basically, throughout my career, the value of gold has been declining, which in our industry means you are experiencing redemptions and the fund is losing value because the price of gold has dropped from $800 an ounce to as low as $250 an ounce."
In response to the decline in the gold market, the company began to develop investment business in emerging Asian markets in the 1990s. In 1996, the company signed a joint venture agreement with Shenyin Wanguo, the predecessor of Shenwan Hongyuan, to develop the fund market in China. However, the Asian financial crisis in 1997 caused a sharp drop in demand for emerging market funds. Assets under management of one of the company's funds, Van Eck Asia Dynasty Fund, fell from US$46.3 million at the end of 1996 to US$11.2 million at the end of 1997.
From 1994 to 1998, the firm's assets under management fell 21% from $1.82 billion to $1.44 billion. In 1997, metal prices reached a 12-year low. Only its Global Hard Assets Fund achieved a positive return of 26% in the three years ending December 1997. As a result, the firm suffered redemptions and its client base shrank.
After 2006
In 2006, the company decided to enter the ETF business and launched its first ETF product, Market Vectors Gold Miners ETF, which allows investors to invest in gold through the stock market instead of directly. Although not as popular as SPDR Gold Shares, which was launched in November 2004, its assets under management increased to $5 billion and became one of the company's biggest successes. By November 2009, the company had issued more than 20 ETF products with total assets under management of $9.7 billion.
John van Eck often travels overseas, especially to Europe, for business. During a trip, he met Sigrid, a German woman 20 years younger than him, and took her back to the United States to get married. She later became VanEck's chief financial officer and a mother of two. In the early 1990s, when his sons Derek and Jan joined the company, VanEck launched a series of business initiatives, primarily focused on ETFs, that have since led to significant growth. Since Derek's death in 2010, Jan has managed the company's growing global business and continues to do so today. Jan graduated from Stanford Law School. Inspired by technology entrepreneurs, Jan joined the family business and began the transformation of ETFs.
Jan van Eck, “My father was very much into economics and history, whereas I am a more business-oriented person, which enabled me to take the opportunity of ETFs and move towards non-actively managed gold funds.”
In Europe, VanEck opened its first office in 2008, focusing on index business, followed by the Swiss office in 2010, focusing on institutional distribution and business development of alternative and active investment management strategies. In 2018, VanEck acquired the Dutch ETF provider "Think ETF Asset Management B.V." to expand its ETF product portfolio in European and international markets.
On March 2, 2021, VanEck launched the Vectors Social Sentiment ETF on NYSE Arca under the ticker "BUZZ." The fund is comprised of stocks that are popular on social media. On its first day of trading, the fund received $280 million in inflows, making it one of the 12 best debuts in history.
To date, VanEck has launched more than 100 ETFs and manages more than $90 billion in funds.
VanEck's success history, source: VanEck official website
Gold ETFs and VanEck
Gold ETFs are financial products that track gold prices and allow investors to buy and sell gold shares through stock exchanges without actually holding physical gold. The emergence of gold ETFs has greatly simplified the process of investing in gold and reduced transaction costs and risks.
The first gold exchange-traded product was the Central Fund of Canada, a closed-end fund founded in 1961. The fund amended its articles of incorporation in 1983 to offer investors physical holdings of gold and silver.
In 1968, VanEck established the first open-end gold stock mutual fund in the United States.
In 1971, President Nixon removed the dollar’s peg from the gold standard. VanEck’s gold fund, known today as the VanEck International Investors Gold Fund, was the first of its kind and became the industry’s best performer as the price of gold soared from $35 to $800 an ounce.
Gold's performance since 2000. Source: VanEck
Despite John's passion for gold, his son Jan van Eck realized that the company's over-reliance on gold was a vulnerability. He shifted the company's focus and took the lead in entering the ETF space. Today, ETFs account for 90% of VanEck's business.
On March 28, 2003, the first gold ETF developed by ETF Securities was listed on the Australian Stock Exchange. On November 18, 2004, State Street Corporation launched the US-listed SPDR Gold Shares, which had assets exceeding $1 billion in the first three trading days.
In 2006, VanEck launched its first gold ETF product, Market Vectors Gold Miners ETF, just two years after the first gold ETF in the U.S. To date, the ETF has an average trading volume of about $20 million and net assets under management of $13.2 billion.
VanEck of the Crypto World: Applying for the First Bitcoin Futures ETF, the First Spot Ethereum ETF, and the First Solana ETF
VanEck is an important player in the Bitcoin ETF and Ethereum ETF that we are familiar with. Unlike BlackRock, which has a high approval rate, VanEck has always been labeled as "the first to apply, bold trial and error". On August 11, 2017, VanEck submitted an S-1 application, planning to launch the first Bitcoin futures ETF, becoming the first ETF issuer to apply for investment in Bitcoin futures. Since then, VanEck has applied for a spot Bitcoin ETF without stopping.
However, in November 2021, the US SEC rejected the application on the grounds of concern that potential fraud in the cryptocurrency market could extend to regulated exchanges. From 2021 to March 2023, its application was rejected three times. However, VanEck fought again and again until the 2024 spot Bitcoin ETF approval wave, and finally successfully launched the product.
Later, VanEck became the first company to submit an application for a spot Ethereum ETF in 2021, almost three years before the SEC began contacting issuers including BlackRock, Fidelity, and Ark Invest.
However, unlike companies like Fidelity and BlackRock, which have simply stuck to Bitcoin and Ethereum ETFs (Robert Mitchnick, BlackRock’s head of digital assets, has publicly stated that BlackRock sees “little to no interest” from clients in cryptocurrencies other than Bitcoin and Ethereum), VanEck has taken an extra step: applying for a Solana ETF.
VanEck filed an application for a spot Solana ETF with the U.S. Securities and Exchange Commission (SEC) in late June, becoming the first issuer to apply for a Solana ETF. In a post on the X platform, Matthew Sigel, VanEck’s head of digital asset research, said, “SOL’s decentralized nature, high utility, and economic viability are consistent with the characteristics of other established digital commodities, reinforcing our belief that SOL may be a valuable commodity with utility for investors, developers, and entrepreneurs seeking alternatives to the duopoly app store.”
Coindesk stated, “VanEck is known for its pioneering role in the digital asset space.”
