UK Bond Fund Ownership Records Go On-Chain On Ethereum And Solana
A UK investment manager with more than £286 billion in assets under management is piloting a native tokenized fund approach that moves the ownership ledger for a regulated bond fund onto public blockchains. The project uses Ethereum and Solana to record who owns the fund, a development that could redefine how fund administration works in a digital age. The effort arrives in 2026 as traditional asset managers look to modernize settlement and governance while keeping a focus on regulatory compliance.
Baillie Gifford is leading the trial, framing the on-chain record as part of the legal ownership register rather than a separate, crypto-centric layer. The approach involves tokenizing the fund with BNY as tokenization and wallet infrastructure provider, and NatWest Trustee and Depositary Services serving as the depositary. The goal is to integrate the ownership record into a unified, auditable on-chain workflow that mirrors conventional processes, but with real-time clarity and 24/7 access.
How the BAGEY Model Works
The project centers on native issuance, meaning the token itself becomes the instrument that records holdings. If the blockchain becomes the legal register, the fund administrator, custodian, transfer agent, and depositary would align behind a single on-chain process. Baillie Gifford calls this a move from tokenized wrappers toward an on-chain ownership ledger that governs who holds a stake in the fund.
The model is described as a fully native UK-regulated OEIC (Open-Ended Investment Company) operating with issuance on Ethereum and Solana. BNY will provide tokenization and wallet infrastructure, while NatWest Trustee and Depositary Services acts as the depositary. In this configuration, the on-chain record forms part of the legal framework for ownership rather than being a purely post-trade record.
What This Means For Investors And Market Structure
- 24/7 settlement and real-time ownership changes could shorten trade cycles and improve liquidity planning for regulated funds.
- Public-chain ownership records may reduce reconciliation costs and boost transparency for investors and managers alike.
- Interoperability with legacy systems and cross-chain compatibility remain central hurdles before wide rollouts.
Officials stress that the test focuses on administration and ownership records rather than exposing investors to crypto market risk. The emphasis is on whether regulated funds can live natively on public rails while preserving legal protections and oversight.
Regulatory And Risk Considerations
UK and EU regulators are watching tokenized fund experiments as the industry weighs the feasibility of public chains for regulated assets. The shift requires clear custody, auditability, and investor-protection standards in an on-chain regime. The team notes that any deployment will proceed with strong governance, independent oversight, and strict compliance checks to preserve fund integrity.
Timeline And Next Steps
Executives say the next phase will test cross-asset settlement, compliance automation, and governance controls around the on-chain ownership records. Given the fund's size and existing distribution channels, rollout is expected to be staged with stringent guardrails to guard investor interests.
Investor Takeaways
- Long-term holders could gain faster access to ownership evidence and clearer proof of stake in the fund.
- Traditional brokers and custodians may need to upgrade systems and workflows to support the new on-chain administration layer.
The push toward bond fund ownership records on public rails reflects a broader push to digitize financial infrastructure. As markets evolve and the public-crypto conversation shifts toward real-world use cases, the boundary between fund administration and blockchain tech grows increasingly blurred. For now, the focus remains squarely on ownership, records, and settlement, not speculative trading, with regulators expected to play a key role in shaping the path forward.
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