The theremin is an electronic musical instrument, played by waving your hands in the air. It works by detecting RF capacitance between a pair of antennae and the player's body. You can see the Theremin being played at the YouTube link below.
Playing the theremin is incredibly difficult, due to the lack of tactile feedback. The human body is very poorly equipped to point precisely at an arbitrary position in free space. Only a handful of players can achieve anything better than squeaky science fiction noises and even virtuoso players struggle constantly with intonation. Modern theremin technique depends on a system of discrete hand gestures, which reduce the player's dependency upon coarse proprioception.
If the Leap Motion is to have any real utility, it will need phenomenally sophisticated software, to interpret intent from hand motion rather than simply passing the hand location as a raw input. The human body simply isn't capable of making the kind of movements that the designers of Leap Motion seem to expect, even with a great deal of practice.