From gold ETFs to Solana ETFs: The history of VanEck's fortune

Author: jk, Odaily Planet Daily

The rise of VanEck, an investment company focusing on ETFs, is full of bold innovations and strategic decisions. From the launch of gold ETFs to the recent Solana ETF, VanEck continues to break through itself and promote changes in financial markets. With the rapid development of the cryptocurrency market, VanEck is at the forefront of the industry and applied for the Solana ETF, opening up new investment areas for investors.

This article will delve into the history of VanEck’s fortune and its decision from gold ETF to Solana ETF.

History of VanEck

In 1955, John van Eck founded Van Eck Global to capitalize on the growing international stock markets in the context of the post-Marshall Plan opening up of Western Europe to American investors, aiming to bring U.S. investors Investment opportunities after World War II. His father immigrated to the United States from the Netherlands in the early 20th century. In the 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 moved the majority of its portfolio to stocks of gold mining companies. From the 1970s to the mid-1980s, gold experienced a bull market and companies experienced significant success. The International Investors Gold Fund attracted substantial subscriptions and has more than $1 billion in assets under management. As a result, John van Eck was invited to participate in famous talk shows of the time, such as "Wall Street Week" and "The Murph Griffin Show."

1980 to early 20th century: Low

However, after the mid-1980s, the gold market boom ended and the company's business slowed down. By February 1998, the International Investors Gold Fund's assets had shrunk to $250 million. John's son Jan said, "He became a gold junkie. Basically, throughout my career, the value of gold has been declining, and what that means in our industry is that you are experiencing redemptions, and funds are Depreciation, as the price of gold dropped from US$800 per ounce to a low of US$250 per ounce.”

In response to the recession in the gold market, the company began to develop investment operations in emerging markets in Asia in the 1990s. In 1996, the company signed a joint venture agreement with Shenyin Wanguo, the predecessor of Shenwan Hongyuan, aiming to develop China's fund market. However, the Asian financial crisis in 1997 caused demand for emerging market funds to plummet. One of the firm's funds, the Van Eck Asia Dynasty Fund, saw its assets under management fall from $46.3 million at the end of 1996 to $11.2 million at the end of 1997.

From 1994 to 1998, the company'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 posted a positive return of 26% in the three years to December 1997. As a result, the company suffered redemptions and its customer 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 allowed investors to invest in gold through the stock market rather than directly. Although not as popular as SPDR Gold Shares, launched in November 2004, it grew assets under management to $5 billion, becoming one of the company's biggest successes. By November 2009, the company had issued more than 20 ETF products, with total assets under management reaching US$9.7 billion.

John van Eck often travels overseas for business, especially Europe. 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 resulted in 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 focused on economics and history, and I am a more business-oriented person, which allowed me to seize the opportunity of ETFs and move to non-actively managed gold funds."

In Europe , VanEck opened its first office in 2008 to focus on index business, followed by a Swiss office in 2010 to focus 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 with the stock code "BUZZ". The fund is made up of stocks that are popular on social media. On the 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 issued more than 100 ETFs and managed more than 90 billion US dollars in funds.

VanEck’s successful history, picture source: VanEck official website

Gold ETF and VanEck

Gold ETF is a financial product that tracks the price of gold, allowing investors to buy and sell gold shares through stock exchanges without actually having to Hold 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 established in 1961. The fund amended its articles of incorporation in 1983 to provide investors with physical gold and silver holding products.

In 1968, VanEck established the first open-end gold stock mutual fund in the United States.

In 1971, US President Richard Nixon canceled the link between the US dollar and 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-performing fund as gold prices 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 recognized the vulnerability of the company’s over-reliance on gold. He changed the company's focus and first entered the field of ETFs. 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 Securities Exchange. On November 18, 2004, State Street Corporation launched SPDR Gold Shares listed in the United States. The fund's assets exceeded US$1 billion within 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 United States. To date, the ETF's average trading volume has reached approximately US$20 million, and its net assets under management have reached US$13.2 billion.

VanEck in the crypto world: Apply for the first Bitcoin futures ETF, the first spot Ethereum ETF, the first Solana ETF

VanEck is an important player in the well-known Bitcoin ETF and Ethereum ETF. Unlike BlackRock's high approval rate, VanEck has always had the so-called "first to apply, bold trial and error" label. 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 to invest in Bitcoin futures. Since then, VanEck has applied non-stop for a spot Bitcoin ETF.

However, in November 2021, the US SEC rejected the application due to concerns that potential fraud in the cryptocurrency market may extend to regulated exchanges. From 2021 to March 2023, his application was rejected three times. However, VanEck fought and failed until the wave of spot Bitcoin ETF approvals in 2024, and finally successfully launched the product.

Later, VanEck was the first company to submit a spot Ethereum ETF application in 2021, almost three years before the SEC began to contact issuers including BlackRock, Fidelity, and Ark Invest.

However, unlike companies such as Fidelity and BlackRock that only stick to Bitcoin and Ethereum ETFs (BlackRock’s head of digital assets, Robert Mitchnick, publicly stated that BlackRock believes that customers are not interested in cryptos other than Bitcoin and Ethereum) With currencies showing "little interest," VanEck took an extra step: applying for the Solana ETF.

VanEck submitted an application for a spot Solana ETF to the U.S. Securities and Exchange Commission (SEC) at the end of June, becoming the first issuer to apply for a Solana ETF. In a post on the The belief that SOL could be a valuable commodity has utility for investors, developers and entrepreneurs looking for an alternative to the duopoly app store."

Coindesk said, "VanEck is known for its pioneering status in the digital asset space. And famous."

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