The European Banking Authority (EBA) is creating a taskforce to advise it on whether virtual currencies, such as Bitcoin and Dogecoin, should be regulated.
The taskforce will be created before July 2014 and will analyse the risks to consumers and regulators.
Potential risks include money laundering due to the anonymous nature of virtual currencies as well as risks to investors.
The EBA has previously reported that consumers risk losing their money by buying, holding or trading digital currency such as Bitcoin because it is not specifically regulated within the EU.
While Bitcoin may be the most commonly cited currency, Dogecoin has gained a lot of attention over the past few months.
In January, almost twice as many daily crypto-currency transactions were made in Dogecoin than Bitcoin.
The currency, which is inspired by the popular meme Doge, has also been raised to fund service dogs for children living with disabilities and to send the Jamaican bobsled steam to the 2014 Winter Olympics.