What is SVG?
SVG is a drawing rather than a grid of pixels: shapes, paths and text described in XML, so it stays sharp at any size. That makes it right for logos and icons and useless for photographs. Converting it to a raster format fixes the size it will ever be.
What is ICO?
ICO is the Windows icon container, and still what a browser fetches when it asks a site for /favicon.ico. One file can hold several sizes at once so the system can pick the right one; each dimension is stored in a single byte, which caps an icon at 256 pixels.