Aviva has invested £50 million in a tokenized share class of its Sterling Liquidity Fund, giving eligible investors the option to hold fund units as digital tokens on the XRP Ledger. The announcement on October 26 illustrates how a conventional investment product can add blockchain-based ownership records without altering its core investment approach.
Fund details and structure
The underlying Aviva Investors Sterling Liquidity Fund manages £22 billion in assets. The new tokenized share class represents an interest in that same fund. According to Aviva, the tokens have the same investment objectives, risks, and other features and protections as shares of the underlying fund. The fund continues to invest in UK sterling short-term, investment-grade debt securities, which remain part of the regulated fund portfolio and are held by BNY Mellon.
Aviva describes the product as a "digital twin." Certain investors can now hold units in digital wallets on the XRP Ledger network, while the securities themselves stay within the regulated fund structure.
Operational benefits and eligibility
Aviva says the practical benefits of tokenization are operational in nature. Potential advantages include streamlined fund ownership, improved transparency, tamper-resistant recordkeeping and settlement functions, and other opportunities to connect traditional investment products with new digital markets. Money market funds (MMFs) in particular are poised to benefit greatly from tokenization, according to Aviva.
The fund is not available to all cryptocurrency wallet users. It is available to eligible investors and is subject to the same regulations as other Irish money market funds.
Service providers and broader ecosystem
Several companies are involved in the program. BNY Mellon acts as the fund's custodian and holds the underlying assets. Komainu provides regulated custodial services for digital tokens. Licuido provides a tokenization platform. Ripple is a technology partner. The XRP Ledger blockchain is where tokenized fund shares are issued and managed.
The launch sits alongside 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. BNY also outlined plans to expand support for tokenized investment products on the XRP Ledger, subject to final BNY and regulatory approvals. That announcement did not identify any new functionality for Aviva's fund.
Aviva's tokenization strategy
Combined investment across Aviva's sterling and US dollar tokenized share classes exceeds £86 million, according to the company. Aviva has been exploring tokenization since 2024 and has accelerated its efforts as interest in tokenized products has taken off among institutional investors. Senior investment director Alastair Sewell told Financial News that Aviva Investors intends to tokenize additional funds in the future but will prioritize money-market funds in the near term.
Aviva is not the first major asset manager to provide tokenized money market funds. A July article in Alphapoint named other market participants, including BlackRock, Franklin Templeton, and JPMorgan. Aviva claims that its entry into the market bolsters its presence in the European tokenized-fund market and that, with its recent investments, it is now one of the largest tokenized MMF providers in Europe.
