Innovators who want to raise capital in a hurry, for projects based on blockchain electronic record systems and electronic currency platforms, are bypassing initial public stock offerings (IPOs) to pitch quick-buck initial coin offerings (ICOs).

Buyer beware: ICOs are growing faster than the legal and regulatory systems set up to protect investors. So if your bitcoins, or dollars, end up buying you only electronic "tokens" worth less than you paid, you're on your own.

A pitch titled "First Ever Real Estate Project on Blockchain" landed in my email Monday. Blockchain is the ingenious system of simultaneously updating electronic ledgers, developed for the pioneering bitcoin electronic currency, so users can verify transactions reliably and fast. Hopeful developers and the investors who love them are building it into new systems.

This offer was to use blockchain to enable a service called Primalbase, "the first ever shared coworking spaces for the tech community," by selling an electronic currency "token that gives lifelong access to office facilities," the pitch continued.

The tokens can be leased, or sold through the blockchain-based "major cryptocurrency exchanges" where bitcoin and rival electronic currencies are traded, to other users and investors. Once Primalbase sells out in its "initial coin offering (ICO)," it plans to make no more. (It doesn't say what's to stop someone else from building similar tokens.)

Bidding started Monday. The organizers planned to sell several hundred tokens, at 3 bitcoins each (about $7,000), and give some free to managers and promoters. Owners will vote on Primalbase office locations to acquire in western Europe, New York, and Singapore, and use their tokens to "access" these spaces. When I checked the auction website after the first day, it showed that buyers had spent more than 2,300 bitcoins buying tokens — a little north of $5 million. By Tuesday afternoon, founder Dmitry Faller wrote in an email that he had sold out, raising more than $7 million.

The pitch called real estate a conservative business "ready for disruption." It assured us that Primalbase is built on the Waves and Ethereum platforms, popular crypto currency platforms that are expanding past bitcoin.

It quoted Waves founder Sasha Ivanov: "Primalbase is a real estate company, while it is also a Blockchain community. It offers a rather unique product: On the one hand, it is access to office space; on the other hand, it is a financial instrument, which can be traded on the market. There hasn't been anything like this before." It directed the curious to FAQ posts on Medium.com.

I ran this by Kevin Werbach, a Wharton School professor who has spread the word on Blockchain. "There has been a wave of these 'initial coin offerings,' in which companies sell the cryptocurrency tokens used in their systems," he told me. "Many have raised substantial sums of money," in the tens of millions of dollars worth of online currencies, "even though they don't yet have a working system."

Who's putting in all that money? "Anecdotally, much of the demand seems to be coming from speculators, ranging from hedge fund employees to Chinese retail investors, desperate for new investment opportunities. People are excited about the potential of cryptocurrencies, but they don't fully understand the services they are investing in," Werbach said.

"It's very much like the dot-com bubble of the late 1990s, when investors would throw money at internet IPOs without a good sense of the business or financial models.

"Many of these initial coin offerings are effectively unregulated securities offerings. The SEC and securities regulators abroad haven't yet taken action, but reports are that they are actively looking at the question."

Delaware and a few other states have been preparing laws to legally recognize blockchain and set standards for its use in law and finance.

Without commenting on Primalbase — he hasn't checked it out in depth — Werbach said investors in such projects ought to consider the basic questions: "Why does this token add value? For something like Brave, which is trying to monetize attention as an alternative to the current Web advertising model, there's a logical reason why the system uses tokens." But why "do you need a token to reserve co-working space?"

For investors at large, "it's only a matter of time before some of these ICOs are revealed as scams or Ponzi schemes," Werbach predicted. "When people lose their money through fraud, there will be heavy pressure for governments to provide the kind of consumer protection they provide to investors in traditional securities."