Dani
Incompatible with copyhandler!
eyebex
I'm using SmartFTP and CopyHandler, too, since years without any problems. The problem you describe is well known (just search the forums for "SFTPDROP") but not related to CopyHandler. The problem occurs when SmartFTP's Shell Handler is not properly registered. To solve this, install https://www.smartftp.com/Products/SmartFTP/SFTPNSI.exe over your existing installation and directly afterwards https://www.smartftp.com/Products/SmartFTP/SFTPDev.exe, and reboot your machine.
Dani
I did this and it still doesn't work 
eyebex
Okay, then try the same with uninstalling SmartFTP first. After uninstalling, reboot, and make sure the directory you installed SmartFTP in got removed. If it still exists, delete it including all remaining files (no fear, you settings are stored elsewhere, but you may want to backup them using the SmartFTP Backup Manager anyways). Now reinstall SmartFTP as described above.
Dani
Still not working
Are you sure, you registered the copyhandler shell extension?
It is possible in the context-menu of the copyhandler trayicon!
Are you sure, you registered the copyhandler shell extension?
It is possible in the context-menu of the copyhandler trayicon!
eyebex
Yes, I'm sure, I'm using it daily. One last try: Open a command prompt at the SmartFTP directory and enter "regsvr32 SmartHook.dll" and "regsvr32 sfFTPLib.dll".
Dani
Doesn't change anything
I even restarted my computer after this.
I even restarted my computer after this.
eyebex
I'm sorry, I'm running out of ideas. It definitely works for me. I remember having similar problems when upgrading from SmartFTP 1.2.x to 1.5.x, but the steps as described above solved them for me.