Is it really measuring brain activity, or is it something else like electrical signals from muscle contractions in your forehead when you frown in concentration?
From Wikipedia: "EEG is the recording of electrical activity along the scalp"
So, it is measuring brain activity, and it is measuring electrical signals on your forehead
It's a science toy, so it is not to be taken too seriously, but the principle is the same as in medical EEG. The main differences are probably resolution, and the fact that a real EEG cap looks like this: