Piracy: ꜱᴀɪʟ ᴛʜᴇ ʜɪɢʜ ꜱᴇᴀꜱ

Whenever you torrent from public torrent trackers it's easy for anyone to see what torrents your IP is currently downloading / seeding. There's even a website for that https://iknowwhatyoudownload.com/

ISPs and govts may track your torrent downloads on the same way that website does. It essentially boils down to indexing the torrents from those public trackers by listening to the DHT network / PEX exchanges. When you're on a decent private tracker (and there are some free) they will disable DHT/PEX for their torrents making it so nobody can't index and they won't show up on websites like the one above.

Setting your torrent client to require encryption to all connections it will create an extra protection layer because then the ISP / govt won't be able to peek into your bittorrent traffic, they'll only see an encrypted TLS connection like the ones made to any SSL capable website. You may also add a blacklist of known entities that go after pirates so your torrent client won't ever connect to those.

If you live outside the US/Canada/AUS you most likely don't even need those measures, let alone a VPN. That entire thing about sending letters to people saying they're downloading torrents is mostly a US thing because in other countries ISPs can't even legally do it.