Xenopus u8 snoRNA binding protein is a conserved nuclear decapping enzyme

U8 snoRNP is required for accumulation of mature 5.8S and 28S rRNA in vertebrates. We are identifying proteins that bind U8 RNA with high specificity to understand how U8 functions in ribosome biogenesis. Here, we characterize a Xenopus 29 kDa protein (X29), which we previously showed binds U8 RNA with high affinity. X29 and putative homologs in other vertebrates contain a NUDIX domain found in MutT and other nucleoticle diphosphatases. Recombinant X29 protein has diphosphatase activity that removes m(7)G and m(227)G caps from U8 and other RNAs in vitro; the putative 29 kDa human homolog also displays this decapping activity. X29 is primarily nucleolar in Xenopus tissue culture cells. We propose that X29 is a member of a conserved family of nuclear decapping proteins that function in regulating the level of U8 snoRNA and other nuclear RNAs with methylated caps.