Computer scientists at Trinity College Dublin are conducting new research into Bitcoin aimed at trying to make the virtual currency more transparent.
The aim of the project is to provide regulators with information about the flow of Bitcoins, similar to the way central banks can track normal currency movements.
The researchers aim to reduce the risk of fraud posed by the use of Bitcoin, while at the same time maintaining an appropriate level of anonymity.
Bitcoin is a virtual digital currency which is not backed by real assets and has no central authorities governing it.
Each Bitcoin is introduced to the system slowly over time, surrounded by a complex mathematical puzzle, and can only be unlocked by experts using high powered computers - a process known as mining.
This slow release guards against inflation, and a finite number of 21 million Bitcoins will have been released by 2140.
Each time a Bitcoin changes hands between anonymous accounts, the transaction is recorded in a publicly available ledger, known as the Block Chain.
The team of researchers at TCD believe that by using the ledger and other publicly available information, they can demystify the Bitcoin ecosystem, and make it more transparent.
Among the ideas being pursued by the group of TCD staff and students is a Bitcoin "credit-check" database.
One member of the team, Cian Burns, has already built a database of Bitcoin accounts, which he linked together to establish how they are connected.
Using various techniques, he was able to build a picture of the account holders, giving a unique insight into some high-profile fraud cases around the world.
"The big benefit of such a picture is that if an address is involved in fraudulent activity, tracing related addresses could protect other users from further fraud," said Burns in a statement.
The team is also considering analysing inter-country Bitcoin movements for indications of potentially shady intentions, by linking Bitcoin users to geographical locations.
"You can be sure that like the Skibbereen Eagle of old, Trinity College and its students will be keeping a close eye on Bitcoin from now on," said Professor Donal O'Mahony, the Professor of Computer Science in the School of Computer Science and Statistics at Trinity who is leading the project.
Professor O'Mahony is author of "Internet - Electronic Payment Systems for e-Commerce", a leading text on electronic payments.
He and colleagues in the "Crypto Mano" group have been listed as the eighth most likely candidates to be "Satoshi Nakamoto", the purported inventor of Bitcoin.