Aviva Investors launches tokenised sterling fund on XRP Ledger

What happened

Aviva Investors has launched a tokenised share class of its Sterling Liquidity Fund on the XRP Ledger, extending a partnership with Ripple that began with a US dollar money market fund earlier this year. The announcement, made on 26 October, covers the asset manager's largest fund, which manages roughly £22 billion.

Aviva has committed £50 million ($66 million) to the new sterling share class. Combined with its earlier tokenised dollar offering, the firm now has more than £86 million ($116 million) invested across the two digital share classes, according to the announcement. The £22 billion figure refers to the total assets of the conventional Sterling Liquidity Fund, not the amount represented on the blockchain.

The structure is a digital twin: ownership of the share class is recorded on the XRP Ledger while the underlying portfolio and the fund's existing arrangements stay as they are. Aviva said holders of the tokenised shares keep the investment objective, risk profile, daily liquidity and regulatory protections of the conventional fund, and reach the shares through digital wallets if they are eligible.

Why it matters

Money market funds sit at the conservative end of asset management, so placing a share class of a £22 billion sterling vehicle on a public ledger is a notable step for blockchain-based fund distribution in Europe. According to the companies, the combined £86 million makes Aviva one of the region's largest providers of tokenised money market funds. The launch also adds a second product to Ripple's institutional fund work on the XRP Ledger, which the company says offers low-cost transactions for issuing and managing fund shares.

Mark Versey, chief executive of Aviva Investors, said the launch demonstrated the firm's commitment to expanding its tokenised range. "We believe tokenised funds can increase efficiency and ultimately lead to improved client outcomes," he said, crediting Ripple's involvement in both launches and indicating that the two companies intend to keep exploring tokenisation.

What the data shows

Ripple said the XRP Ledger has processed more than 4 billion transactions since 2012, supports close to 8 million active wallets and is maintained by more than 130 independent validators. Nigel Khakoo, Ripple's senior vice president of trading and markets, said financial institutions are increasingly adopting infrastructure built for continuous access and faster settlement: "Markets are moving to 24/7 access and settlement is moving to real-time, always-on rails." The tokenised shares do not convert the fund's holdings into XRP; investors hold interests in a regulated money market fund while blockchain records support the digital class.

Background

Aviva's first tokenised share class, for its US Dollar Liquidity Fund, went live on 29 July after approval from the Central Bank of Ireland, with access limited to eligible investors using digital wallets. Licuido, which provides infrastructure for issuing and managing tokenised assets and in which Ripple has invested, worked on that launch and returns for the sterling product. Komainu, an institutional digital asset custodian, supports the new share class, while BNY Mellon remains custodian of the fund's underlying assets. The Sterling Liquidity Fund itself dates to 2002 and is an Ireland-domiciled UCITS vehicle investing in high-grade, short-term debt denominated in pounds.

What is still unclear

The announcement did not say how many outside investors have subscribed to the sterling share class, nor whether the new investment structure will introduce additional settlement services.

What to watch

The launch lands the day before Ripple's Swell conference in New York, scheduled for 27, 29 October, where tokenisation and institutional blockchain adoption are expected to feature. It also follows JPMorgan Asset Management's 22 October expansion of two money market funds, MONY and JLTXX, onto Solana for qualified US investors, alongside multi-chain moves by Franklin Templeton's Benji platform and BlackRock's BUIDL fund. Whether other large European managers follow Aviva onto public ledgers is the question the sector will be watching.

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