So far, 30 yellow bikes have been relegated to the scrap heap and are due to be crushed after being confiscated by Melbourne City Council.

"We're collecting them. We tag them first, they're collected, taken to Collingwood," lord mayor Robert Doyle said.

"oBike has seven days to collect them and pay a $50 fine on each bike and, if they don't, we then recycle them, which is crushing them."

The oBikes have found up trees, on top of portable toilets and across footpaths throughout the city, in some instances becoming "hazardous" to pedestrians.

Last week, 42 oBikes were fished out of the Yarra River.

Without GPS devices inside them, the dumped bikes cannot be traced if they are moved without being unlocked.

"The council has been working to remove the bikes blocking footpaths, labelling them as "illegally dumped rubbish under investigation".

Despite the issues, Chenthan Rangaswamy from oBike Australia is confident in the future of the bike share initiative.

"We do have a procedure in place in terms of the recovery of these bikes," he said.

"But it is challenging at the moment having to go through a bit of an isolated incident of vandalism.

"We've opened dialog with all three major councils and we are acting towards getting an understanding."

In a statement on Thursday, the council said seized oBikes could not be donated to charities.

"When we remove oBikes, City of Melbourne does not become the owner so we cannot give the oBikes to a third party, such as a charity," the council said.

"However, we will provide oBike with the names and contact details of charities that have expressed an interest in damaged or uncollected oBikes. We encourage oBike to get in touch with them."

As the oBike program faces more hurdles, another company is hot on its heels.

The newest bike share initiative from China, Ofo, is set to make its mark in Adelaide this week.

If all goes to plan, the bikes will make their way to Melbourne and Sydney later this year.