Aviva Investors tokenises sterling money fund on XRPL; Aviva invests £50 million

Aviva Investors, the asset management arm of UK insurer Aviva, has launched a tokenised share class of its sterling money market fund, which manages about £22 billion, on the XRP Ledger (XRPL). Aviva Investors and Ripple announced the launch of the new tokenised share class of the Aviva Investors Sterling (GBP) Liquidity Fund in a joint press release on Oct. 26. It is the firm's second tokenisation of an existing fund, following its USD Liquidity Fund in July.

Parent Aviva puts in £50 million

Parent company Aviva invested £50 million ($66 million) in the new tokenised share class. That lifts the total invested across Aviva Investors' two tokenised share classes to more than £86 million ($116 million). The firm said this makes it one of the largest asset management providers of tokenised money market funds in Europe.

The fund being tokenised is the firm's largest. First launched in 2002, it targets low-risk returns and daily liquidity by investing in high-grade UK sterling-denominated short-term debt instruments. The USD fund tokenised in July also runs on the XRPL.

Same fund, a 'digital twin' on-chain

The fund is an Ireland-domiciled UCITS money market fund. Aviva Investors said it uses a "digital twin" model, in which holdings are represented on-chain while the existing off-chain fund structure stays intact. Investors buying through tokens get the same investment objective, risk profile, liquidity characteristics and regulatory protections as investors in the conventional fund.

The launch was again supported by Komainu, a regulated institutional digital asset custodian, and Licuido, a platform for tokenising real-world assets. The share class is available to eligible investors with digital wallets, and all fund assets are held by the fund's custodian, The Bank of New York Mellon. The tokens represent fund shares; what the fund actually holds is sterling short-term debt.

"This expansion of our tokenised offering shows our clear intent to be a leader in this area … We believe tokenised funds can increase efficiency and ultimately lead to improved client outcomes."

Mark Versey, CEO, Aviva Investors

"Markets are moving to 24/7 access and settlement is moving to real-time, always-on rails; this launch shows what that looks like in practice," said Nigel Khakoo, senior vice president of trading and markets at Ripple. Ripple said the XRPL has processed more than 4 billion transactions since 2012, supports nearly 8 million active wallets and is maintained by more than 130 independent validators.

XRP trades at a 0.8% premium in Korea

On Binance, XRP traded between $1.2733 and $1.3071 on Oct. 26 (UTC daily candle), the day of the announcement. It was at $1.2915 on Binance at 7:38 a.m. KST on Oct. 27.

At the same time, XRP traded at 1,724 won on Upbit's Korean won market and 1,723 won on Bithumb. Binance's price converted to won was about 1,710 won, putting the kimchi premium (the gap between prices on Korean exchanges and global markets) at about +0.83% on Upbit.