From Science:
Crawling about like a silky crimson caterpillar and capturing prey by spitting goo, the velvet worm hardly seems like an evolutionary milestone. But for decades, many scientists have pegged it as such, claiming it as the only surviving example of a group of invertebrates that gave rise to the majority of today’s animal species. Now, a new analysis of the velvet worm’s brain suggests this “living fossil” may not be so ancient after all.
DNA evidence suggests velvet worms are closely related to crabs and spiders, possibly as a very early member of the group that gave rise to both. But fossil analysis seems to push the worm’s origins much farther back, relating it to a look-alike in 540-million-year-old rocks.
More here.