The amount of money raised by cryptocurrency and blockchain start-ups via so-called initial coin offerings (ICOs) has surpassed early stage venture capital (VC) funding for internet companies for the past two months.

ICOs are a way for start-ups to raise money from users, similar to crowdfunding, by allowing them to buy a stake. In return, the user will receive a token or digital currency, which are equivalent to shares in the firm. ICOs are popular among cryptocurrency and blockchain start-ups and have exploded in the past few months.

The total amount of money raised via ICOs in April was just under $100 million, but by May this had more than doubled to almost $250 million, according to Coinschedule, a website that tracks such data. In June, ICO funding had hit over $550 million and it was the first month ever that it surpassed angel and seed VC funding. This was noted by Goldman Sachs in a note released Tuesday.

Angel and early VC funding in June was just under $300 million, Goldman noted, according to CB Insights data. In July, ICOs were just over $300 million, while angel and early VC funding was just over $200 million.

In 2017, there has been 92 ICOs which collectively have raised $1.25 billion.

A number of companies have raised a large amount of money via ICOs. A start-up called Tezos raised over $230 million. The company has created a new blockchain — the technology that underpins the likes of bitcoin or ethereum. Another company called Bancor raised $153 million.

But ICOs have received a lot of criticism and are under scrutiny from regulators. The Monetary Authority of Singapore (MAS), said in a recent statement that ICOs are “vulnerable to money laundering and terrorist financing risks due to the anonymous nature of the transactions, and the ease with which large sums of monies may be raised in a short period of time.”

Meanwhile, a start-up called CoinDash started an ICO, but was eventually hacked last month with the funds being stolen.

“Strict regulation comparable to the IPO business to protect investors is required,” Oliver Bussmann, a former chief information officer at UBS, and now head of a fintech advisory firm, told CNBC by email.

But Bussmann was confident that ICOs will continue.

“ICO as a new business model leveraging blockchain technology will sustain as the digital way, combining crowdfunding and (a) new hybrid asset class of equity ownership and currency,” Bussmann said.