Many people use hydrogen peroxide as an antiseptic. "The reason why it foams is because blood and cells contain an enzyme called catalase. Since a cut or scrape contains both blood and damaged cells, there is lots of catalase floating around.
When the catalase comes in contact with hydrogen peroxide, it turns the hydrogen peroxide (H2O2) into water (H2O) and oxygen gas (O2).
2H2O2 --> 2H2O + O2
Catalase does this extremely efficiently -- up to 200,000 reactions per second. The bubbles you see in the foam are pure oxygen bubbles being created by the catalase. Try putting a little hydrogen peroxide on a cut potato and it will do the same thing for the same reason -- catalase in the damaged potato cells reacts with the hydrogen peroxide." - http://www.howstuffworks.com/question115.htm
The foaming action is helpful for pulling dirt and other debris out of cut, and for softening scabs. However, contrary to popular belief, hydrogen peroxide is *not* a good antiseptic. "The reason, according to numerous medical sites, is that there is a downside to the hydrogen peroxide as well. It also damages healthy cells that are needed for the wounds to heal and hinders them from getting to the area where the healing needs to take place. The HealthFinder publication of the U.S. Department of Health and Human Services says don't use hydrogen peroxide on a wound because it interferes with healing. The U.S. Gymnastics team has followed the recommendations of researchers and uses soap and water for cleansing wounds and not hydrogen peroxide. The National Safety Council's First Aid Pocket Guide (1996) says "DO NOT use hydrogen peroxide It does not kill bacteria, and it adversely affects capillary blood flow and wound healing." The Mayo Clinic gives the same advice." - http://www.truthorfiction.com/rumors/h/hydrogen-peroxide.htm