Jan Van Eck says gas fees are more important than Bitcoin (BTC) or Ethereum (ETH) ETFs

The CEO of VanEck — the global investment firm whose Bitcoin Trust (HODL) is among nearly a dozen spot Bitcoin ETFs — believes the cryptocurrency industry should focus more on transaction fees and not so much on Bitcoin (BTC) and Ethereum (ETH) or its equivalent exchange-traded funds.

Jan van Eck said on CoinDesk's Markets Daily show that transaction fees on the Bitcoin and Ethereum blockchains are unpredictable, making it more difficult to develop applications in these ecosystems. “The most important story of 2023 that people know, but I don't think they focus on enough, is simply that transaction costs are now available at affordable prices through Solana or the so-called Layer 2s,” van Eck told CoinDesk TV's Jen Sanasie in an interview.

“If you see the transaction fees for Bitcoin and Ethereum, no one would ever use that database to build on top of that, right? My analogy for non-crypto people is: Would you want to fill your car with $50 a week later? week and then a week at $600? And that’s exactly what the high gas fees on Ethereum are,” he said.

Solana (SOL), often referred to as the Ethereum killer, is a Layer 1 protocol with lower costs and faster transaction speeds than Ethereum. Layer 2s are separate blockchains built on top of Layer 1 chains like Ethereum to reduce scaling and data bottlenecks faced by Layer 1s. Examples of Layer 2 include Ethereum rollups and the Lightning Network on Bitcoin.

With new solutions for lower and more predictable transaction fees, developers can now create applications that are much more useful, which Jan Van Eck believes will become more important in the future. “The most interesting thing happening in crypto right now, to me, is that there are databases that can scale, that can claim lots of users with high uptime, and now have predictable costs. And so now real stuff can be built on top of these databases,” he said. “We’ll see that in the next few years.”

He also said that Ether ETFs are unlikely to be approved by the May deadline because, unlike the approval process for Bitcoin ETFs, the U.S. Securities and Exchange Commission has not responded to submissions from potential issuers.

“We submitted our S1 and heard nothing. So this is something like a sign. It won’t happen without getting the disclosure documents in order,” said Jan Van Eck.

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