Baillie Gifford, a 118-year-old fund manager overseeing approximately £286 billion, has launched the Enhanced Yield Fund, marketed under the ticker BAGEY. The fund entered into a partnership with custody giant BNY to launch BAGEY, which will run entirely on the blockchain.
The enhanced yield fund is now the UK’s first fully tokenized investment fund, and unlike most “tokenized” products that just slap a digital wrapper on a traditional structure, this one is supposed to live entirely onchain.
The fund is structured as a UK-regulated Open-Ended Investment Company denominated in dollars and invested in an actively managed portfolio of short-term corporate bonds.
According to the fund manager, BNY will handle tokenization and wallet plumbing, while NatWest Trustee and Depositary Services will handle depositary duties. Investors can expect a yield of around 7%. The fund is currently limited to qualified investors in the UK, Switzerland, and the Cayman Islands.
Baillie Gifford fronts BAGEY as the real tokenization
Theo Golden, head of digital assets and tokenization at Baillie Gifford, contrasted the fund with what most of the industry has been calling “tokenization” so far. He argued that digitizing old infrastructure will not, by itself, improve finance. Golden pointed out that BAGEY offers a structurally different approach, as it runs entirely onchain unlike other “tokenized” funds.
Baillie Gifford pointed out that most tokenized funds in the market are wrappers, as they don’t entirely operate onchain as intended.
Unlike most tokenized funds, BAGEY will run entirely onchain, meaning investors hold the fund directly, with the chain doing the legal bookkeeping rather than just mirroring it.
BNY’s Katey Neate called it proof that tokenization has moved from concept to real-world application. She proposed the fund as a template that other UK fund managers could emulate.
FCA plays catch-up in regulation matters
The UK’s Financial Conduct Authority authorized the first tokenized UCITS fund under its “Blueprint” model back in January 2025. The FCA then spent 2025 consulting with the industry on how far public blockchains could go inside existing fund rules.
After consultation, the authority came up with PS26/7, a policy statement published in April, confirming that asset managers can use public DLT networks for fund registers. provided they maintain the appropriate controls.
Shortly after the announcement, the $BAGEY token launched on the Solana network and then on Ethereum.
The Solana token trading under the same $BAGEY ticker has no verified connection to Baillie Gifford’s actual regulated product. However, the creators claimed it launched on Ethereum under FCA oversight.
A token tracker shows the Solana-listed $BAGEY trading at essentially zero price and with around 132 holders.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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