As the total value of crypto assets surpasses the trillions of dollars, efficient on-chain portfolio management has become a central challenge for the industry. Assets scattered across multiple blockchains and protocols force both individual investors and institutions to deal with complex manual operations and the high costs of cross-chain bridging. Against this backdrop, Velvet Capital has entered the market as an AI-powered on-chain trading and asset management platform, aiming to deliver a one-stop solution through its DeFAI architecture.
In June 2026, Velvet Capital’s token, VELVET, experienced extreme price volatility, with weekly gains exceeding 1300% at one point, drawing widespread attention across the crypto market. However, on-chain data also revealed token transfers linked to team wallets, shifting market discussions rapidly from "technology narrative" to "distribution dynamics."
Velvet Capital’s Technical Architecture: From Vaults to the DeFAI Operating System
Velvet Capital positions itself as a DeFAI (DeFi + AI) ecosystem for trading and portfolio management, with the core goal of helping users identify trading opportunities, execute investment strategies, and manage digital asset portfolios without relying on centralized intermediaries. Developed by a team with deep crypto industry experience dating back to 2016, Velvet offers a comprehensive suite of tools including a trading terminal, AI Copilot, asset management solutions, and multi-chain automation strategies.
From a technical standpoint, Velvet Capital’s foundation is its Vault system for on-chain asset management. Vaults allow users to create and manage digital asset portfolios in a non-custodial manner. After depositing assets, users receive tokens representing their shares, enabling participation in unified investment strategy management. Unlike traditional funds that depend on centralized institutions, Vaults operate via smart contracts, offering transparency, verifiability, and on-chain settlement. Each Vault deploys its own smart contract, eliminating the security risks associated with shared infrastructure at the architectural level.
On the AI front, Velvet Capital integrates a multi-agent AI system, enabling users to conduct market research, generate technical analyses, and execute trades using natural language commands. The system is accessible through a Telegram interface, further lowering barriers to on-chain operations. Velvet currently supports trading on BNB Chain, Ethereum, Base, and Solana, and offers an execution API for developers to connect to its asset management infrastructure.
Additionally, Velvet Capital provides white-label solutions, allowing asset management firms to deploy DeFi Vaults under their own brands, either through native apps or customized integrations to serve their client bases. This institutional-grade infrastructure positions Velvet as a bridge between individual investors and professional asset managers.
VELVET Tokenomics: Dual-Token Structure and Revenue Distribution
VELVET has a total supply of 1 billion tokens, issued under the ERC-20 standard. Its tokenomics employ a dual-token model: VELVET and veVELVET. Users can lock VELVET to obtain veVELVET (vote-escrowed version); the longer the lock period, the more veVELVET is received. veVELVET balances decay linearly over time, and users can re-lock to maintain their governance and revenue rights.
veVELVET holders enjoy several core benefits: protocol revenue sharing (50% of platform fees are converted to VELVET and distributed to veVELVET stakers), ecosystem incentive emissions, Velvet trading fee discounts, additional referral fee sharing, and Velvet DAO voting rights (covering major decisions like new integrations and fee allocations). In the future, veVELVET will also be used to vote on VELVET emissions allocation across Vaults, with Vault managers able to incentivize voting via "bribe" mechanisms.
Regarding token distribution, aggregated data from multiple sources suggests the following breakdown: team and advisors about 20%, foundation Vault about 18.3%, ecosystem and community about 17.5%, early supporters about 14.9%, future listings and marketing about 7%, initial airdrop and staking about 5%. Other data indicate the combined team and shareholder allocation is roughly 22.5%, ecosystem fund about 25%, and public sale about 10%. The team’s allocation follows a six-year monthly vesting schedule, unlocking only about 0.28% of total supply each month; early investors’ allocation vests over five years, unlocking about 0.33% monthly. The current circulating supply is approximately 248 million tokens, representing 24.83% of the total supply.
Recent Market Dynamics: Liquidity Migration, Price Volatility, and On-Chain Data Insights
VELVET was launched on PancakeSwap on July 10, 2025, with an initial price of around $0.037. In September 2025, it reached an all-time high of about $0.32, with annual gains peaking at 398.69%.
In 2026, VELVET saw even more pronounced market activity. According to Gate market data, as of June 15, 2026, VELVET was priced at $0.35386, with a 24-hour change of -8.70%, a 7-day gain of 12.97%, a 30-day gain of 183.77%, a 90-day gain of 353.06%, and a one-year gain of 875.43%. Market sentiment was rated "neutral." The 24-hour high was $0.58462, the low was $0.30381, and trading volume reached $15.58 million. With a total supply of 1 billion tokens, VELVET’s market cap was approximately $87.85 million, accounting for a market share of 0.015%.
Notably, between June 3 and June 11, 2026, VELVET underwent a dramatic rally, surging from $0.09 to a peak of $1.65—an 18-fold increase in just eight days. The immediate catalyst was Velvet Capital’s strategic integration with Trade.xyz, which promised to unify global markets—including stocks, crypto, and commodities—within a single application. However, on-chain tracking revealed that during the price surge, wallets linked to the team transferred roughly $19.8 million worth of VELVET tokens to centralized exchange deposit addresses. At the same time, Velvet’s official market maker, DWF Labs, moved 6.68 million VELVET (about $6 million) to exchanges. The total flow from project-related addresses to exchanges peaked at around $25.8 million during this period, prompting close scrutiny of token distribution pacing.
On June 12, 2026, Velvet Capital executed a protocol update, migrating all protocol-owned liquidity (POL) to Aerodrome, the largest decentralized exchange on the Base network, and launched the VELVET/USDC trading pair. This move aimed to concentrate liquidity resources and improve trading depth and execution efficiency for Base ecosystem users. However, it also introduced single-platform risk—if Aerodrome were to face smart contract vulnerabilities or governance issues, Velvet’s entire liquidity position would be exposed.
On the funding side, Velvet Capital completed a $3.7 million raise in July 2025, led by YZi Labs (formerly Binance Labs) and Blockchain Founders Fund, with participation from FunFair Ventures, Selini Capital, Gate Labs, DWF Ventures, Cointelegraph Accelerator, and other notable institutions. The capital was used to launch an intent-driven DeFAI trading and asset management ecosystem and to support the issuance of the VELVET token.
DeFAI Narrative: Velvet Capital’s Industry Position
The convergence of DeFi and AI is emerging as a dominant narrative in the crypto industry for 2025-2026. DeFAI essentially brings AI agents into on-chain financial scenarios, enabling intelligent handling of yield optimization, automated execution, and risk management. Within this sector, Velvet Capital has carved out a differentiated position in asset management and strategy execution, thanks to its vertically integrated product architecture—including a trading terminal, AI Copilot, Vault system, Telegram agent interface, and execution API.
Compared to other DeFAI projects, Velvet Capital stands out for its Vault mechanism and institutional-grade white-label solutions. Vaults serve not only as asset storage tools but also as the infrastructure connecting AI agents, portfolio management, and social investing. Asset managers can set management fees, performance fees, entry fees, and exit fees, while Velvet’s platform takes a share of trading and management fees for the protocol treasury. On the security front, Velvet Capital has completed smart contract audits with PeckShield and ShellBoxes, maintains an ongoing bug bounty program on Immunefi, and integrates Forta for real-time security monitoring and OpenZeppelin Defender for automated response.
Looking ahead, Velvet Capital has outlined several development directions: expanding from manual trading to AI agent execution, enabling users to discover opportunities, generate strategies, and execute trades via AI workflows; advancing chain abstraction and omnichain trading capabilities; building a dedicated DeFAI infrastructure network to support large-scale on-chain execution for AI agents, trading apps, and strategy automation; and enhancing privacy features to improve user protection and transaction security.
It’s important to note that the design of token locking mechanisms and distribution paths is a key factor in VELVET’s potential for sustainable value accumulation. The decaying lock period for veVELVET is intended to encourage ongoing participation rather than short-term speculation. However, on-chain data show that during rapid price increases, early holders transferred tokens to exchange addresses, indicating that even well-designed vesting mechanisms cannot fully prevent some early participants from capitalizing on short-term narratives. This "narrative-driven—on-chain follow-up—exchange inflow" cycle is actually a common structure in today’s crypto asset markets, not unique to Velvet Capital. For market participants, distinguishing between "growth driven by technological fundamentals" and "short-term narrative-driven price swings" is essential for evaluating a project’s long-term value.
Conclusion
Velvet Capital has demonstrated a relatively comprehensive technical framework in the DeFAI sector—from its Vault-based on-chain asset management infrastructure, to the trading execution capabilities of its AI Copilot and multi-agent system, and the scalability of its institutional-grade white-label solutions. The veVELVET locking mechanism and revenue-sharing design at the heart of its tokenomics underpin its core value proposition. However, recent on-chain data showing early holders transferring tokens to exchanges, along with the risks associated with concentrating liquidity on a single platform, serve as reminders for market participants to carefully assess the project’s fundamentals and token distribution pace. In the still nascent DeFAI sector, the sustainability of both technical capabilities and economic models will ultimately determine whether Velvet Capital can move beyond short-term narratives and achieve long-term growth.
