It’s a bait catcher, also called “pilchard rings”. I first used one in the 70’s while fishing off a Pier in Florida, everyone was using them to catch small bait fish which they would then use to catch “real fish”. They sold them in the little fishing shop that was on the Pier.
It was simply lowered into the water, and the bait fish would be all over it, attracted to the colourful material, and many would get their gills stuck in the wire loops. It was very effective.
Ray.