A license key, also known as a product key, is a unique code used to activate and validate a copy of a game or software. In the case of GTA V, a license key txt file contains the product key required to unlock the game's full features and play it without restrictions.

You download a file named GTA_V_License_Key.txt from a torrent site, YouTube video description, or a shady forum. You open it, and you see something like:

Sometimes, Rockstar sells the game directly on their launcher with a discount for first-time users. You can get 10% off your first purchase using a Social Club sign-up bonus.