CMS advises Baillie Gifford on launch of first public fully native UK tokenised fund
CMS has advised Baillie Gifford, the independent global investment manager, on the launch of the Baillie Gifford Enhanced Yield Fund (BAGEY), creating the first publicly available fully native UK-regulated tokenised fund.
BAGEY is denominated in dollars and gives eligible investors access to an actively managed, short-duration portfolio of public corporate bonds through a UK-regulated OEIC structure, with tokens issued on the Ethereum and Solana blockchains. Tokens are issued directly as the investor's holding in the fund, with public blockchains used as the legal source of truth for ownership. BNY will be providing tokenisation and wallet infrastructure for the fund (subject to applicable regulatory approval).
CMS advised Baillie Gifford on all aspects of the authorisation of the fund, including the regulatory analysis of its innovative features, advising on the FCA rule modifications to support the fund’s operation, and the preparation of bespoke drafting for the fund documents. CMS also led on the services agreement with BNY, which is critical to the fund’s launch and operation.
Advising on this landmark project further strengthens CMS’s reputation as a leader in the digital assets and authorised funds sectors, showcasing the firm’s cutting-edge credentials on innovative fund launches and complex digital finance projects. Drawing on market-leading expertise across financial regulation, funds and digital finance, CMS is uniquely positioned to advise clients on pioneering fund structures and other transformative digital finance initiatives as the sector continues to evolve.
Commenting on the transaction, Karagh Gilliatt, Partner at CMS, said: “We’re proud to have advised Baillie Gifford on this groundbreaking launch, which represents a significant milestone for the UK asset management industry. It has been a pleasure working with the team to help bring this innovative product to market.”
The core CMS team included Karagh Gilliatt, Jamie Marshall and Maggie Lund (Finance), with further support provided by Lisa McClory (Finance).
