Key Takeaways
- • Aviva Investors invested £50 million in a newly launched tokenized share class of its Sterling Liquidity Fund, which holds £22 billion in total assets, with the new share class announced October 26.
- • Tokens representing fund units are issued and managed on the XRP Ledger, while the underlying securities remain in the regulated fund portfolio held by BNY Mellon.
- • Aviva describes the product as a "digital twin" that carries the same investment objectives, risks, and protections as the underlying fund shares.
- • Combined investment across Aviva's sterling and US dollar tokenized share classes exceeds £86 million, according to the company.
- • Aviva plans to tokenize additional funds but will prioritize money-market funds in the near term, and claims it is now one of the largest tokenized MMF providers in Europe.
Summary
Aviva Investors has invested £50 million in a tokenized share class of its Sterling Liquidity Fund, a vehicle with roughly £22 billion in total assets. Announced on October 26, the share class gives eligible investors access to the fund through digital tokens on the XRP Ledger. According to DL News, the migration does not alter the fund's investment objective, which remains focused on UK sterling short-term, investment-grade debt securities.
The structure preserves the legal and custodial framework of the existing fund. The securities remain part of the regulated portfolio and are held by BNY Mellon, which serves as custodian. Komainu provides regulated custodial services for the digital tokens, Licuido supplies the tokenization platform, and Ripple acts as technology partner. Aviva calls the product a "digital twin" and states that tokenized shares carry the same investment objectives, risks, features and protections as the underlying shares. The fund is available only to eligible investors and is subject to the same regulations as other Irish money market funds.
Aviva frames the benefits as operational, including streamlined fund ownership, improved transparency, tamper-resistant recordkeeping and settlement functions, and connections to new digital markets. Combined investment across the sterling and US dollar tokenized share classes exceeds £86 million, according to the company. Senior investment director Alastair Sewell told Financial News that Aviva Investors intends to tokenize additional funds but will prioritize money-market funds in the near term.
The launch coincides with a broader expansion of institutional blockchain services. On October 27, BNY and Ripple announced that BNY's digital asset custody platform supports XRP and RLUSD, and BNY outlined plans to expand support for tokenized investment products on the XRP Ledger, subject to final BNY and regulatory approvals. The announcement did not identify new functionality for Aviva's fund.
Aviva is not the first major asset manager in this segment. According to a July Alphapoint article, BlackRock, Franklin Templeton and JPMorgan have also offered tokenized money market funds. Aviva asserts that its entry strengthens its presence in the European tokenized-fund market.
The structure preserves the legal and custodial framework of the existing fund. The securities remain part of the regulated portfolio and are held by BNY Mellon, which serves as custodian. Komainu provides regulated custodial services for the digital tokens, Licuido supplies the tokenization platform, and Ripple acts as technology partner. Aviva calls the product a "digital twin" and states that tokenized shares carry the same investment objectives, risks, features and protections as the underlying shares. The fund is available only to eligible investors and is subject to the same regulations as other Irish money market funds.
Aviva frames the benefits as operational, including streamlined fund ownership, improved transparency, tamper-resistant recordkeeping and settlement functions, and connections to new digital markets. Combined investment across the sterling and US dollar tokenized share classes exceeds £86 million, according to the company. Senior investment director Alastair Sewell told Financial News that Aviva Investors intends to tokenize additional funds but will prioritize money-market funds in the near term.
The launch coincides with a broader expansion of institutional blockchain services. On October 27, BNY and Ripple announced that BNY's digital asset custody platform supports XRP and RLUSD, and BNY outlined plans to expand support for tokenized investment products on the XRP Ledger, subject to final BNY and regulatory approvals. The announcement did not identify new functionality for Aviva's fund.
Aviva is not the first major asset manager in this segment. According to a July Alphapoint article, BlackRock, Franklin Templeton and JPMorgan have also offered tokenized money market funds. Aviva asserts that its entry strengthens its presence in the European tokenized-fund market.
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