An emerging paradigm in peer-to-peer (P2P) networks is to explicitly consider incentives as part of the protocol design in order to promote good (or discourage bad) behavior. However, effective incentives are hampered by the challenges of a P2P environment, e.g. transient users and no central authority. In this paper, we quantify these challenges, reporting the results of a month-long measurement of millions of users of the BitTorrent file sharing system. Surprisingly, given BitTorrent's popularity, we identify widespread performance and availability problems. These measurements motivate the design and implementation of a new, one hop reputation protocol for P2P networks. Unlike digital currency systems, where contribution information is globally visible, or titfor-tat, where no propagation occurs, one hop reputations limit propagation to at most one intermediary. Through trace-driven analysis and measurements of a deployment on PlanetLab, we find that limited propagation improve...