Comment by ThePhysicist

So, my understanding of the current play in this space is as follows:

  - Create a large number of worthless cryptographic tokens.
  - Distribute around half of them as "freebies".
  - Keep the other half to yourself / distribute them among your investors.
  - Start a hype by injecting your investors money into your currency. 
  - Hope that people will start to trade/speculate with your currency, buying it for real monies.
  - As the trading volume ramps up, start extracting money from the system by exchanging your tokens for real monies.
  - Profit!

Is this about right? I mean it's quite ingenious as you seem to create money out of thin air, but I really can't wrap my head around how this isn't outlawed as an MLM scheme by governments.