Birch Hill raises $2.5m for onchain lending

February 13, 2026

Birch Hill Holdings, an institutional digital asset infrastructure firm focused on onchain lending and tokenised asset markets, has closed a $2.5m pre-seed funding round co-led by ParaFi Capital and Castle Island Ventures to advance compliant access to blockchain-based credit.

The round drew backing from ParaFi Capital and Castle Island Ventures, with additional participation from Nascent, FalconX Ventures, Coin Operated Group, The Operating Group, JST Digital and Flowdesk, as well as industry executives including Ramin Kamfar, founder & CEO of Bluerock.

Birch Hill aims to provide fiduciaries with a compliant framework for generating income in blockchain-based credit markets. Its approach places risk management and governance at the forefront, leveraging institutional-grade risk modelling to support transparent and auditable participation. The firm’s initial strategies are launching through established blockchain lending platforms, with plans to expand into a broader range of institutional credit strategies tailored to differing compliance and risk requirements.

The founding team combines experience across traditional credit markets and digital asset infrastructure. CEO Bhavin Vaid began his career in structured credit at Goldman Sachs, later investing in private equity at Cerberus Capital, before moving into digital assets at 10T Holdings. CTO Jack Forlines and COO Connor Flanagan previously worked on institutional risk systems within BlackRock’s Aladdin platform before transitioning into digital asset data and infrastructure.

At the core of its offering is the Birch Hill Collateral Risk Framework, designed to reduce loss potential and strengthen governance. The framework incorporates real-time monitoring of collateral quality, liquidity conditions and pricing data integrity, forming the basis of its institutional risk oversight.

Birch Hill Holdings CEO Bhavin Vaid said, “Credit markets stand to benefit from the efficiencies of blockchain-based settlement, but institutional participation has been limited by the need for stronger risk oversight and operational clarity.

“Our goal is to bring the discipline of traditional credit investing together with modern infrastructure in a way that meets institutional standards for governance, transparency, and risk management.”

Castle Island Ventures founding partner Matt Walsh said, “We continue to see growing interest from institutional investors in thoughtfully structured exposure to blockchain-based credit. Birch Hill’s team brings the combination of traditional finance experience and digital asset expertise required to build durable infrastructure in this space.”