BNY Mellon, the world's largest custodial bank, has introduced a blockchain-based transfer agency system for its fund services business, which oversees approximately $8.6 trillion in assets across 7.6 million accounts. The move, first reported by Solid Intel and detailed by CoinCentral, marks one of the most significant institutional adoptions of distributed ledger technology for core financial infrastructure.
The new system records fund transactions and investor ownership on a blockchain, replacing the traditional back-office function that maintains official share registries, processes trades, and distributes dividends. Carolyn Weinberg, BNY's chief product and innovation officer, said the bank is bringing "the books and records onchain," aiming to create a single ownership ledger that reduces the need for repeated reconciliation among intermediaries. The bank has not disclosed which blockchain protocol it uses, but the initiative builds on its digital asset strategy, including a custody platform launched in 2022 and experiments with tokenized deposits.
Major clients are already on board. Baillie Gifford, which manages over $261 billion, will use the service for what the companies call the first fully native UK-regulated tokenized fund. BlackRock and Dreyfus, BNY's money-market and cash-management business, are also expected to adopt the platform for planned funds. This comes as asset managers expand tokenized money-market funds and onchain products, where ownership interests are issued as digital tokens backed by traditional assets like cash or short-term debt.
BNY Mellon emphasizes that existing systems will remain in place. Emily Portney, global head of asset servicing, noted that "trillions and trillions of dollars" of funds will continue on traditional rails, with the blockchain layer adding a parallel digital record. The bank manages more than $59 trillion in total assets under custody and administration, giving the project enormous scale. The announcement also coincides with BNY's Q2 2026 results, a 19% dividend increase, and a $500 million preferred stock offering, highlighting its financial strength.
The launch signals that major financial institutions see long-term blockchain utility beyond cryptocurrencies, targeting the highly regulated, data-intensive transfer agency function. With competitors like State Street and JPMorgan also investing in blockchain fund administration, BNY's implementation is among the largest in terms of assets, potentially accelerating industry-wide adoption. Regulators, including the SEC, have shown openness to blockchain record-keeping that meets investor protection standards, further legitimizing the trend.
