NOTE: This post is for education purposes only.
Spent some time trying to fix and after reading/following some resources online like youtube links and others, they still didn't’ seem to work for me. Finally, found this regkey, changed one value and it worked for me. It may help you too..
The association of magnet links on torrent sites (which most of them use instead of a .torrent file) may break if you’ve installed/uninstalled a program that also handles magnet/torrent links and may have override your favorite torrent proggie e.g. uTorrent as your default torrent handler.
So, first do try the following:
1) This Youtube link http://www.youtube.com/watch?v=6nELJpK7B5E
2) This other resource http://www.metserve.com/blog/magnet-links-working-with-chrome
If those links still don’t help or the problem isn’t fixed, fear not, there’s one other thing you can do:,
1) Open up the registry (click start, then run, regedit). In Windows 7 or higher, just type in the application bar search box
2) Look for the following key
3) Edit the REG_GZ value for ProgID and enter your favourite program you wish to associate with, e.g. uTorrent
(How to find my program’s progID - http://www.ehow.com/how_6871656_progid.html
And done! IT should work now. Cheers!