Fintech firm Calastone is aiming to save £3.4bn in fund distribution costs by moving more than 1,700 of its clients to blockchain.
The firm will complete the switch in May, which will be one of the industry's biggest transfers.
The benefit of moving to blockchain is a simplification of processes and reduction in costs as information does not need to be re-entered at each stage of the fund transaction.
Julien Hammerson, chief executive of Calastone, said the current system for transactions was "economically and operationally unsustainable".
Calastone is hoping to save £3.4bn from the transfer but said it was too early to say whether it would affect its charging model as blockchain would alter how the transactions take place. Instead, fund managers are expected to pass on the savings in the form of lower costs.
Blockchain was tested by the firm in 2017 to buy and sell mutual funds and the firm said the results were satisfactory, using multiple data centres and clouds to protect the system.
BNP Paribas Asset Management and Ostrum Asset Management have already completed end-to-end fund transaction tests using blockchain, while Standard Life Aberdeen and Columbia Threadneedle Investments said they had formed a retail platform specialising in impact funds that will use blockchain.
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