The Eastern European country is proposing to create so-called estcoins, which could be used by members of its e-Residency programme.
The launch would make Estonia the first country with an Initial Coin Offering (ICO) – essentially crowd funding finance.
It comes after the launch of the country’s e-Residency programme – a so-called borderless nation – that allows anyone to create a secure digital citizenship of Estonia.
The programme is largely designed for entrepreneurs – helping to make it easier to start and run a company, regardless of location.
There are now around 22,000 e-residents from 138 countries, as well as plans for a data embassy.
Kaspar Korjus, managing director of the e-Residency programme, said: “Just like e-Residency, cryptocurrencies have evolved from a niche idea into an increasingly normal part of modern life for people everywhere in the world because they offer real solutions to real problems.”
Japan and Australia, are among the countries that have introduced legislation to help make bitcoin and other digital currencies safer, by bringing them into the mainstream.
China has also developed a prototype cryptocurrency.
Governments are trying to tackle money-laundering and funding for illegal activities, such as terrorism, using cryptocurrencies.
Mr Korjus said Estonia has an advantage in the race to normalise cryptocurrency.
He added: “No other country has come close to developing both the technology and the legal frameworks that would enable them to introduce and securely manage tradable crypto assets globally.
“Fortunately, the secure digital identities used by e-residents (as well as citizens and residents of Estonia) are now the ideal mechanism for securely trading crypto assets in a trusted and transparent digital environment.
“The tokens can not be counterfeited and the government oversight means they can not be used for illegal activities.”
“A government-supported ICO would give more people a bigger stake in the future of our country and provide not just investment, but also more expertise and ideas to help us grow exponentially.”