Geocoins are used in the GPSr game of geocaching.
"I use multibillion dollar military satellites to locate tupperware hidden in the woods!"
As I am an avid geocacher, tho, I don't have enough time to do it alot, I feel I have the ability to explain this to you non geocachers, also known as "Muggles".
Basically, I take a waterproof, weatherproof container and add a logbook, (logsheet), a cache note describing what a cache is and using a handheld GPSr, hide it somewhere, then post the coordinates at one of many geocaching websites.
www.geocaching.com is the most popular of them, and then you would use those coordinates to find the container and sign the logbook, then post your find on the website. If the container is large enough, some people, myself included, fill the container with trinkets for trade. If you take something from the cache, you must leave something in trade.
Along these lines, geocoins are for trade, collecting, or to be used as travelbugs that have a mission to be completed before being returned to the original owner via caches. There are a multitude of different kinds of tradable, and collectable geoitems. Geocoins are just one of the more popular. There is a guy here in the Denver metro area that has collected a few hundred of them from around the world! People have them custom made for themselves, groups do it and even geocaching.com has put out a number of them.
They can be wood, metal, plastic, and I even have one that was made of paper and laminated by the original releaser.
If you have a newer android phone, you can even use it as your GPSr by downloading one of many geocaching apps. I use my Galaxy Note, and my son and my wife use their Inspire 4Gs.
Try it, it is a lot of fun!
Enjoy!