On Friday, the European Union commented on the use of Bitcoin, issuing a similar warning that some central banks and states across the globe had said since last week.

The European Banking Authority said, "Currently, no specific protection exists in the E.U. that would protect consumers from financial losses if a platform that exchanges or holds virtual currencies fails or goes out of business." The banking authority of the EU also said in its statement that consumers should be careful about dealing with the digital currency as they are not protected through regulation when making payments using Bitcoin. it also added that Bitcoin is vulnerable to hackers and could lose its value easily. Moreover, European Banking Authority said misuse of the currency could immediately have law enforcement close exchange platforms, which would make customers' investments inaccessible.

China last week banned its banks from using the digital currency last week due to its concerns that it threatens the state's financial stability and that it could be used for money-laundering activities. Germany already declared that it will not be recognizing Bitcoin as a foreign currency and that any gains from transactions using the digital currency will be taxable. Norway, said a New York Times report, is said to be mulling over a similar stance.

The European Banking Authority cited cases of consumers losing sizeable amount of virtual currency with little chances of getting them back, saying that the virtual currency was not under its jurisdiction for them to act upon as the crypto-currency is not widely known as money.

The European authority added, "While virtual currencies continue to hit the headlines and are enjoying increasing popularity, consumers need to remain aware of the risks associated with them."

Although Bitcoin hit the thousand-dollar trading price per share in November, it is currently now trading below the amount since then, The New York Times said in its report.