Baillie Gifford launches natively issued tokenized fund on Solana

Tokenization Insight
4 hours ago
2 min read

Baillie Gifford, an UK asset manager, launches a natively issued tokenized fund on Ethereum and Solana.

Baillie Gifford has launched $BAGEY (Baillie Gifford Enhanced Yield Fund), a regulated, natively issued tokenized fund. The fund is an actively managed portfolio of short-dated bonds, structured as a UK OEIC, with custody provided by BNY and a daily NAV.

➡️Why this matters

One of the biggest hurdles facing institutional adoption of tokenized funds is not technology. It is legal certainty and ownership structure.

Institutional investors typically ask two questions:

1️⃣ What exactly do I own?

2️⃣ What happens if something goes wrong?

Many tokenized fund structures today introduce additional layers between investors and the underlying assets through SPVs, note issuers, or other wrappers.

This creates:

1️⃣ Additional counterparty risk arising from intermediary issuing vehicles.

2️⃣ Additional legal complexity where investors may not hold the same direct claim on fund assets that they would through a traditional fund structure.

The direction many institutions prefer is simple:

1️⃣ The fund share itself becomes the onchain asset.

2️⃣ Investors own a regulated fund interest rather than a tokenized claim issued by a separate vehicle.

BAGEY follows this model by issuing the fund directly onchain, with the token representing the fund share itself rather than a wrapper around it.

If this approach gains traction, it could help address one of the key concerns that has limited institutional buy-side adoption of tokenized funds: achieving the operational benefits of blockchain without materially changing the legal protections investors are accustomed to in traditional fund structures.

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