Lotus Water lanterns were originated from a legend. It's said that there were many drowned ghosts long long ago. So people placed Lotus Water lanterns which included the offerings of food and ghost money into water to commemorate  or relieve them.

Now people doing this in many festivals are to bless or pray their wishes
come true. On many festivals such as Halloween ,Easter Day, or Memorial Day ,etc, people place and enjoy the lanterns with the floating in the water on nights.