The Dogecoin (CRYPTO: DOGE) price is on a tear.
One Dogecoin is currently trading for 6.1 US cents. That's up 15% since this time yesterday.
The meme token, with a Shiba Inu as its mascot image, ranks number 11 on the list of global top cryptos with a market cap of US$8 billion.
While the 15% gain will be welcomed by investors, Dogecoin has a long, long way to go before recovering its all-time high. That was set on 8 May last year, when the token reached 73.8 US cents. It's down a gut wrenching 91.8% since that high, according to data from CoinMarketCap.
So, why are crypto investors bidding up the Dogecoin price today?
Risk assets lift on US Fed move
It looks like there are two factors helping drive the Dogecoin price higher today.
First, the US Federal Reserve lifted the official interest rate in the world's largest economy by 0.75% yesterday (overnight Aussie time) to combat soaring inflation of 8.6%.
While that was the biggest single rate hike in 28 years, crypto and share markets alike had largely priced in the higher rate, with some share selling earlier in the week.
And Fed chair Jerome Powell helped soothe investor nerves, saying that outsized rate increases wouldn't become common.
"Clearly, today's 75 basis-point increase is an unusually large one and I do not expect moves of this size to be common," he said overnight.
Risk assets gained strongly on the news, with the tech-laden Nasdaq closing up 2.5%.
And cryptos are broadly joining the rally.
Bitcoin (CRYPTO: BTC), the world's first and biggest crypto, is up 6% over the past 24 hours.
What else is boosting the Dogecoin price today?
Another factor that looks to be boosting the Dogecoin price is progress with Dogechain, with the first testnet launched yesterday.
Dogechain, if successfully implemented, will enable Dogecoin to participate in decentralised applications (dApps) and decentralised finance (DeFi), offering some real life utility to the meme token.
According to Bitcoinist, "Rather than compete with Dogecoin, Dogechain harmonises with the meme coin and enhances it with smart contract capability."
Additional real world uses, atop serving as an alternate to fiat currencies for transactions, could offer greater support for the Dogecoin price.
