You are using sftp to connect your server in a chrooted environment and you met the error below.
subsystem request failed on channel 0
Couldn’t read packet: Connection reset by peer
This causes because of wrong external library configured in your sshd_config. So, edit your sshd_config and use internal-sftp. Because openssh already has internal sftp functionality and you dont need any external libraries.
Find the line beginning with “Subsystem”. Comment out and add the following line.
Subsystem sftp internal-sftp