A 118-year-old Edinburgh asset manager just launched a regulated bond fund on a public blockchain. On June 22, 2026, Baillie Gifford launched the Baillie Gifford Enhanced Yield Fund (ticker: BAGEY) with banking giant BNY, and the Financial Conduct Authority approved it.
BAGEY is an actively managed, short-duration portfolio of public corporate bonds. Per CoinDesk, it runs natively on Ethereum and Solana, pays eligible investors a yield of around 7%, and is denominated in dollars. It is structured as a UK-regulated Open-Ended Investment Company, open to investors in the UK, Switzerland, and the Cayman Islands. And it is the first UK-authorized fund issued onchain from the start.
Native Issuance Closes a Gap That Held Tokenization Back
For most of the last decade, tokenized funds came with an asterisk. A manager took an existing fund, wrapped it in a token, and sold you the token. The token represented your ownership. The legal ownership itself was elsewhere, in a traditional registry, where retail buyers rarely notice. Anyone with a fiduciary duty noticed immediately, because that gap was the whole risk.
BAGEY removes the gap. The token is the fund holding. The blockchain serves as the legal register of record, so investors own the fund directly and have direct recourse through the onchain structure. Theo Golden, Baillie Gifford’s head of digital assets, told CoinDesk the fund is issued onchain, not a token placed on top of one, giving holders direct ownership and direct recourse.
The FCA Spent Nearly a Year Getting It Through the Sandbox
BAGEY moved through the FCA’s Regulatory Sandbox, a process that lasted close to a year and involved more than 11 teams across the regulator, spanning Authorizations, Supervision, Policy, Legal, and Innovation.
The watchdog has been telegraphing this for a while. As City AM reported, the FCA issued fresh guidance on tokenized funds last autumn, and the BAGEY approval delivers on its Strategy 25 commitment to support growth. The same regulator has lifted its ban on crypto tracker funds and softened earlier plans to restrict crypto lending. The direction is to stop the UK from falling behind on digital assets, without dropping the supervision that makes the assets investable in the first place.
BNY and NatWest Run the Infrastructure
Baillie Gifford did not build the plumbing alone. BNY, one of the largest custody banks in the world, supplies the tokenization and wallet infrastructure. NatWest Trustee and Depositary Services acts as the fund’s depositary, keeping familiar custody and compliance roles within the structure.
Katey Neate, BNY’s global head of investor solutions, said the launch shows how regulated fund structures can evolve for a more digital, connected market. Both Baillie Gifford and BNY were added to the FCA’s list of registered crypto companies as part of the launch.
Where BAGEY Lands in a $29 Billion Market
The timing tracks a market that has stopped being experimental. The total value of tokenized real-world assets on public blockchains, excluding stablecoins, reached around $29 billion in early 2026, up from under $8 billion in 2024. Corporate bonds now sit among several categories that have passed the billion-dollar mark. As we reported, the bigger constraint on this market has never been the technology. It has been legal clarity.
That is what makes BAGEY worth watching. A 118-year-old name put itself behind a fund where the chain is the source of truth and the recourse is direct, under UK regulation. The infrastructure was ready years ago. Trust was the harder build.
Author: Ayanfe Fakunle
