Initial Coin Offerings (ICOs) are a largely unregulated means for companies to raise capital without undertaking the costly and legally intensive process of an initial public offering (IPO).
Purchasers of ICOs receive tokens, similar to shares in a stock offering. Like an IPO, early supporters in ICOs hope to profit from an increase in value of the ICO tokens as the company or product matures. When an ICO flourishes, early investors can be rewarded greatly.
With the potential of massive returns, ICOs have captured increased public interest. This graph from Google Trends shows the exponential increase in search traffic for “ICO” in the fourth quarter of 2017.