VELVET jumps 29% as perp funding flips positive and open

VELVET gained 29% over the past 24 hours at press time as perpetuals positioning flipped from net short to net long and short liquidations accelerated. Open interest surged 79% to roughly $42 million, adding leverage to a rally that has already gained more than 80% since July 7.

Key Takeaways

VELVET gained 29% over the past 24 hours at press time, extending an early-July uptrend.
Holder wallets climbed from 22,830 to 25,450 in July, setting a new all-time high within the past 24 hours.
Perpetual funding flipped from negative earlier in the day to around 0.0023% as of writing, reflecting a shift toward long positioning.
Open interest rose 79% to roughly $42 million as liquidations skewed heavily to shorts ($182,000 vs $20,260 in longs over 12 hours).

VELVET Extends Early-July Run With a 29% 24-Hour Rip

VELVET’s latest leg higher was a fast one: up 29% over the past 24 hours at press time. The more important context for traders is that this wasn’t an isolated candle. From July 7 to the time of writing, VELVET was already up more than 80%, which frames the 24-hour move as an acceleration phase inside a broader July trend.

What stands out here is the mix of spot participation signals and derivatives stress. When a token is already up 80% in a week and then adds another 29% day-over-day, the market usually needs either a fresh narrative bid, a leverage impulse, or both. The data in this case points to both attention and positioning shifting at the same time.

On the attention side, CoinMarketCap’s social metrics strengthened alongside price. “Mindshare” rose 38% to 1,820 over the last 24 hours, and CoinMarketCap’s social sentiment score printed 6.34 out of 10, a bullish lean. CoinMarketCap defines the metric plainly: “Mindshare gauges how many mentions and interactions a token attracts within a 24-hour window.”

Derivatives Tape: Funding Turns Positive as Shorts Get Forced Out

The cleanest explanation for the speed of the move sits in the perp tape. Early in the day, VELVET’s funding rate was negative even as price climbed, a setup that typically implies the market is leaning short into strength. By the time of writing, that regime flipped. Funding swung to around 0.0023%, signaling long positions outweighed shorts.

That flip matters because it lines up with forced positioning, not just discretionary buying. Liquidations over the last 12 hours totaled roughly $182,000 in shorts versus $20,260 in longs. The imbalance tightened further in the most recent window: over the last four hours, shorts lost $71,620 while longs gave up just $784.

In practice, this is what a squeeze looks like in small-cap perps. Shorts get pressured first, liquidations add market buys, and the funding rate turns as the market chases the move and rebalances exposure.

The second-order effect is leverage compounding. Open interest surged 79% to roughly $42 million. When OI expands into a rally at the same time funding turns positive, it usually means fresh leveraged exposure is entering during the move, not after it. That can support continuation if flows stay one-way, but it also increases the size of any unwind if price stalls and late longs become the next forced sellers.

Spot Participation Signals: Holder Wallets Hit a Fresh All-Time High

Derivatives can move price quickly, but they rarely build a trend alone. The spot-side participation signal here is the holder count. CoinMarketCap data showed wallets holding VELVET rose by more than 2,500 in July, climbing from 22,830 to 25,450 at the time of writing. That 25,450 figure marked a new all-time high within the past 24 hours.

This is the part that keeps the move from reading as pure perp noise. A rising holder base alongside an 80%+ July run suggests the rally has been accompanied by distribution into new hands, not just a rotating leverage game.

Still, traders should be careful about overfitting social and holder metrics into a price forecast. The methodology behind “mindshare” and the sentiment score isn’t established here as predictive. What they do provide is a real-time confirmation that attention and participation expanded into the move, which is often when perps get crowded fastest.

Heatmap Clusters Above and Below Price Set the Next Volatility Zones

CoinGlass’s liquidation heatmap showed liquidation clusters stacked above the current price, with additional clusters below sitting close to the current price. The interpretive takeaway is two-sided volatility.

Clusters above price can act as upside magnets during momentum, because a push into those zones can trigger forced closes and accelerate the move. At the same time, clusters below being close suggests that if price pulls back, it may not need a deep retrace to start hitting liquidation pockets on the downside.

The limitation is tactical. The heatmap description does not include exact price levels or the specific liquidation bands, which makes it hard to translate into precise risk mapping. Traders can still use the structure conceptually, but the absence of levels means the heatmap is more of a volatility warning than a trade plan.

The forward signals are straightforward:

Whether perpetual funding stays positive around ~0.0023% or flips back negative, which would indicate positioning is rotating again.
If open interest holds near ~$42 million or starts to unwind after the 79% surge, raising deleveraging risk.
Whether the liquidation imbalance remains short-heavy or shifts toward long liquidations, which would change the character of the move.
If holder wallets continue rising beyond 25,450 after the new all-time high, reinforcing that spot participation is still expanding.

When OI Jumps With Positive Funding, Continuation vs. Flush Comes Down to Leverage Discipline

I read this move as derivatives-led acceleration on top of a real July uptrend. The evidence is the intraday regime flip: funding was negative while price rose, then swung to ~0.0023% as shorts were liquidated far more than longs ($182,000 vs $20,260 over 12 hours). That’s consistent with a squeeze dynamic, not a slow spot-led grind.

The part I care about most is the 79% open-interest jump to roughly $42 million. OI expanding into a 29% daily move is a double-edged signal. It says new participants are willing to put on leverage at higher prices, which can keep momentum alive if the market keeps finding incremental buyers. It also means the market has built a larger liquidation surface area in a short time.

Scenario one is continuation with controlled leverage. In that world, funding stays modestly positive around the current ~0.0023% level, open interest holds near ~$42 million rather than collapsing, and liquidations remain skewed toward shorts. The confirmation point is simple: the market keeps paying longs, but not at a rate that suggests an immediate overcrowding, and the liquidation tape doesn’t flip to punishing late longs.

Scenario two is the classic leverage flush. Here, open interest starts to unwind after the spike, and the liquidation mix shifts from short-dominant to long-dominant. Funding can stay positive in the early part of that process, which is why I don’t treat “positive funding” as a bullish stamp by itself. The invalidation point for the continuation thesis would be a clear rotation where longs begin absorbing the bulk of liquidations and OI falls meaningfully from the ~$42 million area.

Scenario three is churn with two-sided wicks, which fits the heatmap description best. With liquidation clusters both above and close below, price can get pulled into pockets on either side as leverage rebalances. In that regime, the cleanest tells are whether funding flips back negative and whether holder wallets keep making new highs beyond 25,450. If wallets keep rising while perps cool off, the move looks more sustainable. If wallets stall while OI stays elevated, the rally becomes more dependent on leverage staying disciplined.

The core thesis is that VELVET’s 29% day was powered by a perp-positioning flip and fresh leverage, and it will be confirmed if funding holds near ~0.0023% while open interest stays elevated around ~$42 million without the liquidation tape rotating into long-heavy losses.

Sources

AMBCrypto