Short answers, pulled from the story.
An initial coin offering is a form of capital raising in which a project issues and sells digital tokens using blockchain technology, typically in exchange for cryptocurrency or fiat currency. The tokens may grant access to a product or service, represent participation rights within a network, or function as speculative digital assets traded on cryptocurrency markets.
One of the first widely cited token sales was conducted by Mastercoin in 2013. Ethereum followed with its own token sale in 2014, which raised approximately 31,000 bitcoin to fund development of its blockchain platform.
China banned initial coin offerings on the 4th of September 2017, when seven Chinese financial regulators declared the practice a form of illegal public financing and ordered all past proceeds refunded to investors. Prior to the ban, ICOs had raised nearly 400 million dollars from about 100,000 Chinese investors.
The U.S. Securities and Exchange Commission concluded in its July 2017 Report of Investigation on The DAO that certain ICO tokens could qualify as securities under existing federal law. It went on to charge ICO promoters including the co-founders of Centra Tech, Inc. and Maksim Zaslavskiy, and in April 2019 its FinHub office issued guidance listing over thirty factors for determining whether a digital asset is a security.
During 2017, initial coin offerings raised billions of dollars globally, often for early-stage projects with limited operating history. Individual sales reached large scales too, including Ethereum's roughly 31,000 bitcoin raise in 2014 and block.one's 4 billion dollar unregistered ICO of EOS.IO, later settled for a 24 million dollar penalty.
ICO fundraising volumes declined substantially after the 2017-2018 boom amid regulatory enforcement and market contraction. Some market participants shifted to alternative models such as security token offerings, and similar token sale mechanisms have continued through structured platforms offered by cryptocurrency exchanges.