What ads.txt is and why an empty one costs you money
ads.txt stands for "Authorized Digital Sellers." It is a plain text file that lives at the root of your domain — yoursite.com/ads.txt — and it lists, line by line, every advertising company allowed to sell inventory on your site. Buyers check that file before they bid. If your domain shows up in an ad exchange but your ads.txt does not name the seller offering it, the buyer assumes the inventory is spoofed and refuses to bid.
For a small publisher this shows up as quietly lower revenue rather than a broken page, which is why it goes unnoticed for months. Google AdSense specifically warns inside your account when the file is missing or does not contain your publisher ID, and unresolved warnings can limit which advertisers are willing to buy your impressions.