Baillie Gifford Makes Ethereum the Legal Register for UK Fund

By Nathan Brooks

Baillie Gifford, the Edinburgh-based asset manager with more than £286 billion in assets under management, has adopted Ethereum as the legal ownership register for a regulated UK fund. The vehicle, the Enhanced Yield Fund (ticker BAGEY), treats on-chain tokens as the official record of investor holdings rather than as a mirror of an off-chain ledger — a first for a fully native UK-regulated tokenized fund.

The move, announced on June 22, 2026, follows a regulatory opening created by the Financial Conduct Authority. Under policy statement PS26/7, published on April 30, 2026, the FCA permits distributed ledger technology to serve as the unitholder register inside OEIC structures — open-ended investment companies, the standard UK fund wrapper that issues and cancels shares as investors enter and exit. Baillie Gifford moved from policy statement to product announcement in roughly two months.

What did Baillie Gifford actually build?

Most tokenized funds to date have run a two-ledger architecture. A traditional transfer agent maintains the authoritative record off-chain, while a blockchain token functions as a digital twin of that entry. Settlement happens on-chain, but legal ownership does not.

BAGEY removes that duplication. The tokens themselves constitute the legal representation of an investor's interest in the fund. If the chain records an investor as holding units, that investor holds units. The blockchain is the register of record, not a synchronized copy.

The product is also multi-chain in its distribution. Units were first made available on Solana, with minting on Ethereum beginning August 5, 2026. The Ethereum deployment draws the attention because it carries the register function. The arrangement suggests managers may increasingly treat public blockchains as interchangeable distribution rails rather than committing to a single network.

Who operates the infrastructure?

Two named institutions anchor the operational stack:

• BNY Mellon supplies the tokenization and wallet infrastructure, covering token creation and the management of accounts that hold the units.
• NatWest Trustee and Depositary Services acts as the fund's depositary — the independent party that, under UK fund structures, oversees how the fund is run and safeguards its assets.

The underlying strategy remains 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 stands at $100. Eligibility is limited to professional investors in jurisdictions including the UK, Switzerland and the Cayman Islands.

What does this change for practitioners?

The significance lies in Ethereum's role, not its price. A public blockchain now serves as the legal source of truth for a regulated UK fund, moving the network from settlement experimentation toward official record keeping. For fund administrators and transfer agents, that shift compresses the reconciliation layer: when the chain is the register, there is no second ledger to reconcile against, and corporate actions, transfers and record-keeping collapse into a single operational surface governed by the FCA's DLT framework.

For asset managers, BAGEY establishes a working template under PS26/7 that others can replicate. The gap of roughly two months between the FCA's guidance and this launch demonstrates that a compliant path from policy to product is now measured in quarters, not years. Expect further OEIC structures to test DLT-based registers as the framework matures.

For investors, the practical questions remain grounded. The approximately 7% yield is a target rather than a guarantee, and a bond portfolio carries interest rate and credit risk regardless of which ledger tracks ownership. The $100 minimum lowers the financial barrier, but professional-investor eligibility restrictions in specific jurisdictions mean the product is not a retail on-ramp.

The open question is whether FCA-permitted DLT registers extend beyond pilot-scale funds into mainstream UK fund structures — and how quickly depositaries, auditors and administrators build the operational capability to support them.