An ICO is an initial coin offering, analogous to an IPO or crowdfunding. Investments in it involve a high risk, but have the chance of a high return.
ICO (Initial Coin Offering) – the counterpart of IPO or crowdfunding, only with a greater risk, but also with the possibility of a large profit. The startup company publishes a so-called white paper in which it gives information about all aspects of the project in the hope of raising money.
Everyone who wishes transfers cryptocurrency to the authors (most often Ethereum) and receives new tokens to the purse of the platform on which the ICO is held. If the project does not go bust and the creator brings the project to an end, these tokens are traded on the exchange afterwards.