Say you wanted to open an amusement park. Rather than meeting with investors, the creator can presell "tokens" for guests to play in the park, then continue issuing them as time goes on, using the money to build the amusement park. What's more, you've also created a secondary market for trading those tokens for actual use in the park.

This is typically how PwC global blockchain practice founder Subhankar Sinha explains cryptocurrency, a financial system built upon blockchain technology. At a July 20 event at Morrison & Foerster's New York offices, Sinha joined a panel of experts from law, finance and technology to discuss how initial coin offerings (ICOs), the raising of funds for cryptocurrency projects, are impacting the way organizations are funded. And while this approach to funding is increasingly popular, it's raising concerns among everyone from technologists to lawyers in addressing regulations.

"What you're seeing now is what happens when you create a financial market and there's zero regulation," said Nick Chirls, founder and partner and Notation Capital, a company that invests in cryptocurrency projects. "I think what you're seeing now is the full range of highly responsible behavior that will be very positive for the ecosystem going forward, and some projects that lack that. That, I think really is a major risk for the ecosystem."