It is no secret that cryptocurrencies have been experiencing significant volatility in recent weeks. Concerns linger over energy consumption, regulations and the post-pandemic market. News that China is further targeting miners — and an uncertain Federal Reserve meeting this week — are not helping matters. Like other cryptos, Dogecoin (CCC:DOGE-USD) is feeling the pain of a volatile week. However, there is a piece of Dogecoin news that could see Dogecoin prices recover.
So what do you need to know? As of this writing, Dogecoin prices are down nearly 5% over a 24-hour period. Trading volume is up nearly 40% over that same time period.
However, there is one piece of news that is promising. Today, a blockchain startup called DogeLabs shared that it is working on developing a bridge between Dogecoin and Ethereum. If this happens, DOGE holders would have access to ETH-backed decentralized finance (DeFi) solutions and staking programs.
What else do you need to know about the latest Dogecoin news? Importantly, it appears that this announcement follows commentary from Vitalik Buterin, the Ethereum co-founder. DogeLabs said that Buterin recently said that he sees the potential for a Dogecoin-to-Ethereum bridge. With this in mind, the startup says it is working with a team of developers from Data Syndicate to make this happen.
Dogecoin bulls should also know that DogeLabs has another plan in the works. According to the same press release, the startup is considering developing a DOGE burn wallet. This would allow developers to build applications on the Dogecoin blockchain and then send a small portion of DOGE to the burn wallet. In practice, this could address concerns around the inflationary model of Dogecoin.
DOGE-ETH: What to Know About the Latest Dogecoin News
Lastly, what exactly is DogeLabs? And how is this startup working on catalysts that could boost Dogecoin prices?
At the beginning of May, Tanzeel Akhtar wrote for CoinDesk that DogeLabs would start supplying DevOps for Dogecoin along with AppSwarm (OTCMKTS:SWRM). Together, they said their goal was to provide more intentional support for Dogecoin, and to create a team that could build apps on the Dogecoin blockchain.
It seems then that this latest news is a follow-up on an earlier announcement. While DogeLabs is simply floating ideas — and is still building out its development resources — this is something for investors to watch.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Sarah Smith is the Editor of Today’s Market with InvestorPlace.com.