Baillie Gifford has launched a tokenised fixed income fund for professional investors, marking a further step in the evolution of regulated onchain investment products beyond money market funds.
The asset manager has opened the Baillie Gifford Enhanced Yield Fund (BAGEY) to eligible professional investors in the UK, Switzerland, Hong Kong and the Cayman Islands.
The fund is structured as a US dollar-denominated, UK-regulated OEIC investing in a portfolio of government and corporate bonds.
Baillie Gifford said the strategy aims to deliver enhanced yield relative to its benchmark through active management, with the portfolio currently offering a yield of around 7%, a two-year duration and an average credit quality of BBB.
Unlike traditional fund launches, BAGEY will only be available in tokenised form. Each token represents an investor’s holding in the fund, with blockchain technology serving as the legal record of ownership.
The launch reflects growing interest among asset managers in using blockchain infrastructure for regulated investment products, an area that has so far been dominated by tokenised cash and money market strategies.
Sandy Jones, director of digital assets at Baillie Gifford, said the fund was developed in response to demand from investors already operating within digital asset markets and demonstrated how tokenisation could be applied to more sophisticated investment products.
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“BAGEY began with a practical client requirement: a regulated way to access professionally managed fixed income without stepping outside the digital infrastructure that investors use to hold and manage assets.
“Making the Fund operational across four markets means we can now work with a broader range of professional investors and build real evidence of where tokenisation delivers practical value through actual use rather than theory.”
Baillie Gifford said interest in the strategy is expected to come from crypto-native investors and family offices, alongside more traditional institutional channels such as wealth managers, financial advisory platforms and defined contribution pension schemes looking to explore digital assets.
The fund will initially be deployed on Ethereum, with support for Solana planned at a later date.
Eligible investors can subscribe to and redeem fund tokens using either fiat currency or stablecoins, with a minimum investment of $100. The strategy currently supports USDC transactions and offers daily dealing alongside an indicative NAV updated every 15 minutes while global markets are open.
The manager said this provides greater transparency and supports potential onchain use cases.
Stuart Dunbar, partner at Baillie Gifford, described the launch as a natural progression from the growth of tokenised money market funds.
“Money-market funds have played an important role in showing that regulated products can run onchain.
“BAGEY builds on that progress by bringing actual investment expertise onto the same infrastructure, including active bond selection, credit allocation, duration and currency management. Tokenisation earns its place when it carries investment strategies that require skill and judgement.”
The fund can be accessed through a range of regulated digital asset custodians including BNY, Anchorage Digital, Archax and BitGo Bank & Trust.
The launch comes as asset managers continue to explore whether tokenisation can become a viable distribution channel for a broader range of investment strategies, with the technology increasingly viewed as a way to improve settlement, ownership recording and investor access to regulated products.
Baillie Gifford managed $260bn (£190bn) of assets as of 30 April 2026.