In what is believed to be an Australian first, Victorian authorities have seized millions of dollars of the digital currency, bitcoin, allegedly the proceeds of online drug trafficking.

The Director of Public Prosecutions obtained a restraining order on bitcoins from the alleged drug traffickers' online wallet in 2012/13, according to its latest annual report.

The digital currency is used by a small, but growing, number of Australian businesses and has also been adopted by criminals.

"Several million dollars" worth of bitcoins were seized under the Confiscation Act, the report said.

The report, which was tabled in state parliament on Tuesday, said bitcoins appealed to criminals because they left no financial trail.