A file swapping system, similar to Gnutella (Limewire and BearShare are two popular Gnutella clients). The daddy of all of them is of course Napster. SwapNut is a Java application, and it works similarly to Gnutella: a client, installed on your machine, communicates with a network of other clients. The client is symmetrical, in that generally you are not allowed to download if you are not offering files for trade.
Swapnut is, as far as I can see, used mostly to trade porn and warez. There is not a lot of music available and currently it is a small system. I have the impression that the client can also double as a BearShare and Gnutella client, but the web site is not rich in technical detail. There is also a gloriously pointless instant messaging and chat system.
Swapnut's makers (http://www.swapnut.com) coyly insist that Swapnut is only for very legitimate and serious applications, like sharing Shakespeare's public domain works and distributing share- and free-ware.