I haven't seen this one but they probably got your old password from some hack of another website maybe you used in the past. Definitely a phishing scam. Delete and forget about it!
Yeah everyone who has ever been in a password breach has got one of these. To be honest I'm quite flattered someone is watching me watch porn but sadly I don't think they are the opposite sex. Bummer.
It's just a variant of the old blackmail scam as several has told. Delete it and forget it. I looked through my spam folder last week, and there was 2 of the kind.
We get these every so often. It'll have been sold data from when your account details from some site had been hacked. https://haveibeenpwned.com/ nothing to worry about, they won't have installed malware or anything, just a scare email trying to get people to pay bitcoins. Change your password often. You can use Find out if you’ve been part of a data breach Firefox Monitor to tell you when you're details have been hacked.
EDIT: Microsoft are coming out with a similar service but not released yet I don't think.