Editor's note: This column has been updated to disclose the writer's advocacy of blockchain technology--the underpinning of all crytocurrencies--and a Consumer Financial Protection Bureau warning about these investments.

You may have heard about Bitcoin, Ethereum, and other cryptocurrencies in the news recently. Now entrepreneurs officially have got their hands on the market for fundraising purposes.

Just the other day, Bancor raised $155 million in cryptocurrency equivalent in what is the largest crowdfunding campaign in the history of the world. (It should be noted here that I am an advocate of blockchain technology.)

What is an initial coin offering (ICO)?

An initial coin offering is made when a company wants to fund itself through cryptocurrency. People can "back" the ICO by contributing other cryptocurrencies such as Bitcoin or, more commonly, Ether (the name for Ethereum's coins/tokens). It is basically a crowdfunding campaign that instead of using Kickstarter uses the Ethereum platform's smart contracts to allow people to exchange other cryptocurrency for the new native coins.

Editor's note: Bitcoin and digital currencies, as with any investment, may involve the risk of loss. The Consumer Financial Protection Bureau has warned that virtual currencies, including Bitcoin, carry "significant risk" to consumers.

The coins can then later be sold and purchased on cryptocurrency exchanges (once listed) or held long term for potential profit. Additionally and oftentimes, the coins themselves could be exchanged or used for the company's native product or service, like in the case of Steem.

After the company creates its own native currency (referred to as coins or tokens), the price of the new coins varies, from fractions of a cent to hundreds of dollars.

ICOs are very attractive to investors, considering the average listed ICO here has a more than 1,000 percent return in under a year. What other kind of investment would ever get that kind of crazy return? That's a 10x return in a year, or sometimes less.

The largest ICO return is for a cryptocurrency and blockchain tech company called Stratis (STRAT), which has a 110,912 percent return in about a year, as of the time of writing. That means if you bought $1,000 worth at their ICO, you have made $1,109,120 to date.

Who should get involved?

The age-old saying holds true: "Don't invest what you aren't willing to lose."

If you are interested from an investment perspective, then hopefully you will make a lot of money. Considering the average return so far, investing seems quite tempting. And for entrepreneurs, its like raising money via Kickstarter, except you don't have to ship out physical items and you can quickly fund your startup or company. Bancor reached its $155 million funding in about two hours. Additionally, the money raised can be stored in coins, which have been appreciating in value quite quickly. So the money you raise also makes you more money--sometimes many multiples of what you raise.

TenX is an example of an upcoming ICO that has been highly anticipated

TenX is essentially a debit/credit card that gets rid of the need for banks for cryptocurrency holders. Instead of having to exchange your cryptocurrency into fiat (government issued currency like USD), you can simply put it on your TenX debit/credit card and it will instantly convert it to your native currency when you go to spend money.

It has features like a credit card's. The card adds incentives to use your card more often. When you use it, you get a kickback, just like points on a credit card.

What problem does this solve? TenX solves the (big) problem of having to sell off and convert your cryptocurrency back to fiat if you want to spend it in a physical or traditional environment that's not yet accepting cryptocurrency as payment.

What I'm getting at is these ICOs are no different than any startup. If an ICO is going to be successful, it needs to solve a problem worth solving. And for that reason, TenX could be one of the biggest ICOs, because it solves a huge problem in the cryptocurrency community. And in a market that's growing by billions (market cap) almost daily.

The trend for ICOs is just heating up. Startups all over the world are looking at ICOs as a serious way to raise a large amount of money quickly.

Here is a full list of upcoming ICOs.