Baillie Gifford Adopts Ethereum as Legal Ownership Register for UK-Regulated Fund
Key Takeaways
- •Baillie Gifford's Enhanced Yield Fund (BAGEY) is presented as the first fully native UK-regulated tokenized fund whose legal unitholder register resides directly on Ethereum, replacing the conventional two-ledger structure where tokens merely mirror an off-chain record.
- •The fund was announced on June 22, 2026, with units initially distributed on Solana and minting on Ethereum starting August 5, 2026, making it a multi-chain product.
- •The structure was enabled by the FCA's policy statement PS26/7, published April 30, 2026, which permits DLT-based unitholder registers within OEIC fund structures, and Baillie Gifford announced the fund roughly two months after the guidance.
- •The fund holds government and corporate bonds, targets an approximate 7% yield, offers daily trading with a $100 minimum ticket, and is restricted to professional investors in jurisdictions including the UK, Switzerland, and the Cayman Islands.
- •BNY Mellon provides the tokenization and wallet infrastructure, while NatWest Trustee and Depositary Services serves as the fund's independent depositary, and the register model remains available to other OEIC operators under the same rules.
Baillie Gifford, the Edinburgh-headquartered UK asset manager that oversees more than £286 billion in assets, is now using Ethereum as the legal ownership register for a regulated UK fund. For this vehicle, the blockchain serves as the official ledger rather than a mirror of an off-chain record.
The vehicle is the Enhanced Yield Fund, ticker BAGEY. It is being described as the first fully native UK-regulated tokenized fund to run its ownership registry directly on Ethereum.
One Ledger, Not Two
Most tokenized funds launched to date have relied on a two-ledger arrangement: a traditional transfer agent maintains the authoritative record off-chain, while a token issued on a blockchain functions as a digital twin of that entry.
BAGEY abandons that structure. The tokens themselves constitute the legal representation of an investor's interest in the fund. If the chain records that an investor holds units, then that investor holds units.
Multi-Chain Rollout
The fund was announced on June 22, 2026. Units were first made available on Solana, with minting on Ethereum starting August 5, 2026. That makes BAGEY a multi-chain product, at least in terms of distribution. It is the Ethereum component that is drawing attention, owing to its role as the register of record.
Fund Terms and Service Providers
Beneath the tokenized wrapper, the strategy is comparatively conventional. The fund holds a portfolio of government and corporate bonds and targets a yield of approximately 7%. Investors can trade daily, and the minimum ticket for eligible investors is set at $100. The offering is aimed at professional investors in jurisdictions including the UK, Switzerland and the Cayman Islands.
BNY Mellon, one of the world's largest custody banks, provides the tokenization and wallet infrastructure, covering the creation of the tokens and the management of the accounts that hold them. NatWest Trustee and Depositary Services, part of NatWest Group, serves as the fund's depositary. In UK fund structures, the depositary is the independent party that oversees how the fund is run and safeguards its assets.
The Regulatory Change That Enabled It
The structural shift was made possible by the Financial Conduct Authority's policy statement PS26/7, published on April 30, 2026. The FCA is the UK's conduct regulator for financial firms and markets. PS26/7 sets out how distributed ledger technology can be used within authorized fund structures, and specifically permits DLT-based unitholder registers inside OEIC structures.
An OEIC, or open-ended investment company, is a standard UK fund wrapper that issues and cancels shares as investors enter and exit. The unitholder register is the list of who owns those shares. Under the new policy, the FCA said the list could live on a blockchain.
Baillie Gifford moved quickly after the guidance landed: the gap between the policy statement and the fund's first announcement was roughly two months.
What It Means for Asset Managers and Crypto Infrastructure
For Ethereum, the significance lies less in price and more in function. A public blockchain acting as the legal source of truth for a regulated UK fund moves the network from settlement experiment toward official record keeping.
The multi-chain design is also noteworthy. Distributing on Solana while registering on Ethereum suggests that fund managers may treat blockchains as interchangeable rails rather than committing to a single chain.
Because PS26/7 applies to authorized fund structures generally rather than to a single firm, the register model BAGEY uses is open to other OEIC operators under the same rules. How widely comparable launches follow remains to be seen.
Open questions remain for investors. The approximately 7% figure is a target rather than a guarantee, and a bond portfolio still carries interest rate and credit risk regardless of which ledger tracks ownership. Access is likewise constrained: while the $100 minimum lowers the financial hurdle, eligibility is restricted to professional investors in specific jurisdictions, so the product is not a retail on-ramp.
Sources: CryptoNewsNet · Crypto Briefing
