Projects are issuing tokens to raise funds (ICO ~= IPO). They are of two types: 1) Protocol coins (coins that have some value within the project / product) and

Projects are issuing tokens to raise funds (ICO ~= IPO). They are of two types: 1) Protocol coins (coins that have some value within the project / product) and 2) Asset coins (coins that can be thought of as shares in a company). Protocol coins are being positioned as presold revenue and need not necessarily conform with securities laws. Most ICOs are trying to position their coins as kickstarter-type "token gifts" (e.g. T-shirts) Asset coins on the other hand, come under the purview of securities laws and act People are buying these coins because of FOMO. Large majority of these projects having ICOs are scams - not too different from the dot-com bubble. Eventually, some good ideas are going to come out of these projects.