File sharing happens when a file is shared between two people. The download speed is usually not a problem, but when it comes to uploading there is almost always a bottleneck because the upload speed is almost always limited. So the file transfer is restricted by the sender and the receiver is the one that has to deal with the frustration. (The BitTorrent Effect)
P2P, or peer to peer, file sharing is a connection between two computers over the internet. So instead of downloading something form a single person with throttled, limited, download speeds, instead groups of people share the file and your computer draws from all of them to download the file quicker. P2P file transfer though puts a lot of trust in the peers that the file is coming from.
Torrent, a way to someone to download a file in pieces from different sources instead of downloading the full file from one source, which bypasses the upload limit that a single transfer source can limit the speed of the download. The ones I am familiar with the most are BitTorrent and Utorrent, for current P2P programs, but the most well known before is probably Napster, which was only for music files, and raised a lot of controversy about pirating.
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