A trader can get through every phase of a funded challenge, close a position at a gain, and still see the account shut down, not because of a loss, but because of a condition that went unread at purchase. It looks like an exception. The numbers suggest otherwise: among more than 300,000 funded accounts studied, only about 7% of traders ever collected a payout, and the reason usually had little to do with how they traded.
This is the starting point for Velotrade’s 2026 Prop Firm Transparency Report, which examined the published rulebooks of six firms, Topstep, FTMO, FundingPips, Blue Guardian, HyroTrader and Velotrade, to pin down the terms that in practice decide whether a funded trader keeps their gains. The point it presses is blunt: buyers focus on profit splits, while the provisions buried in evaluation guides and help-center pages are what shut most accounts down.
It is the rules, not the trades, that close most accounts
That claim rests on two separate industry datasets:
- In a 2024 study by FPFX Tech covering more than 300,000 accounts (reported via Finance Magnates), just 7% of traders ever reached a payout, while only around 14% passed a challenge at all.
- A separate hoc-trade study of 500,000 traders attributed roughly 70% of failures to breached loss limits rather than missed profit targets.
- Consistency rules can wipe out 33% to 50% of the profit earned on one strong day. Four of the six firms reviewed run one.
The pattern holds across the board: the trade is rarely the problem. The rulebook is.
“Could a trader read our rules once, in one sitting, and know every way their account could end? If the answer is no, the rulebook is not finished. Most of this industry has treated that as a marketing problem. We think it is the entire product,” said Gianluca Pizzituti, Chief Executive Officer of Velotrade.
A market expanding and failing at the same time
Demand for funded accounts has climbed even as the number of providers was cut back. Monthly searches for “prop firm” went from about 880 in early 2020 to roughly 49,500 by 2025, a 56-fold rise, pulling wave after wave of first-time buyers into a market whose decisive terms never appear on the sales page.
The other side of that growth is stark. When MetaQuotes withdrew MT4 and MT5 licenses from prop firms serving US clients in February 2024, several well-known names went under. The Funded Trader stopped trading and later conceded more than $2 million in denied payouts. True Forex Funds closed citing insolvency, leaving about 300 traders owed $1.2 million. SurgeTrader shut within days, its CEO admitting that roughly 10% of payout obligations were left unpaid.
The same trade, two firms, opposite results
Every prop account has a maximum-loss line, but the way firms set it differs sharply, and that difference can flip the outcome of one and the same trade. A fixed drawdown is measured from the starting balance and stays put: on a $100,000 account with a 10% limit, you are out at $90,000, without exception. A trailing drawdown moves up with your equity and never comes back down.
The report puts one account through both methods. A routine day-seven pullback bottoms out roughly $10,000 clear of a fixed $90,000 floor, so the account is never in danger and ends up about $6,500 ahead. Against a trailing floor that has crept up near the peak, the identical dip crosses the line and closes the account on the spot. FTMO sets its maximum loss at 10% of the starting balance; Topstep’s trailing limit climbs with the end-of-day balance and locks at the start. Neither firm hides its model, but fixed versus trailing is no small print. It settles the trade.
The cost of trading too well
A consistency rule caps how much of your total profit any one session may account for. Do too well, too fast, and you fail regardless. With a 40% single-day cap against a $1,000 target, a strong $450 session is 45% of profit, past the limit, so the evaluation fails even though the target was hit.
Topstep, FundingPips, Blue Guardian and HyroTrader each run a version, at evaluation or on a payout tier. FTMO uses a 50% Best Day Rule on its 1-Step product, spelled out in its help center rather than the headline rules. The strictest single-day caps tend to attach to the most attractive payout options. Velotrade says it runs no consistency rule at any stage. For readers looking at the crypto-focused end of the market, Velotrade’s rundown of the top crypto prop firms lays these terms out side by side.
The rule that can end a trade that never lost
Loss limits close the most accounts. But the report flags a quieter rule as the hardest to anticipate, because it can end an account on a trade that never closes in the red.
A max-risk-per-trade rule caps how much any single position or trade idea may be down at any instant, measured on unrealized, floating, profit and loss, not on closed trades. It sits below the advertised daily loss limit. If an open trade’s paper loss so much as grazes the cap during the session, even for a moment, the rule can fire and the account is done, even if that trade would have gone on to close in profit.
Three features make it easy to miss at checkout:
- It is measured on unrealized loss. The trade never has to close in the red.
- It can activate only after funding. You can clear the entire evaluation without once running into the rule that then governs your funded account.
- It can pool re-entries. Close a losing trade and reopen in the same direction, and the losses are added together against the cap.
Firms label it differently. Blue Guardian’s “Guardian Shield” force-closes trades near 1-2% unrealized (depending on account type); a first breach cuts your split to 50%, a second closes the account. FundingPips runs a “Risk Per Trade Idea” rule at the funded stage that pools re-entries. HyroTrader requires a stop-loss within five minutes of every trade, monitored live. Velotrade says it publishes no secondary per-trade or per-idea cap beneath its daily limit.
None of these is improper as risk management. The report’s argument is about where they sit: a rule that can end a funded account arguably belongs beside the price, not buried several pages into a help center.
The rulebooks, side by side
The full rulebook comparison measures all six firms against the terms that most often decide a payout. Since Velotrade both published the report and appears in the final column, that column reflects a market participant’s own position rather than a neutral grade, and traders should confirm current terms directly with each firm.
| Firm | Drawdown Model | Floating P&L Counted | Consistency Rule | Position Risk Rule | News Trading | Weekend Holding | Rules Change | Where the Detail Lives |
|---|---|---|---|---|---|---|---|---|
| FTMO | Fixed, from initial balance (10%) | Yes, loss line includes unrealized P&L | Best day threshold on some account types | No secondary per-trade cap on standard accounts | Unrestricted in evaluation; short window around targeted releases once funded | Allowed in evaluation; funded Standard must close before the weekend; Swing exempt | Yes, news and weekend rules tighten at the funded Standard stage | Trading objectives pages, FAQ |
| Topstep | Trailing, end of day, locks at starting balance | Yes, realized and unrealized P&L | Best day threshold in evaluation; separate threshold on payout | No formal per-trade cap; full size into major news is a listed risk | No fixed blackout window; maximum size into major news flagged | Not permitted at any stage; day-trading program with a fixed daily loss | Consistency requirement and payout path differ once funded | Help center articles |
| FundingPips | Varies by product; most models fixed, one product trails 5% from peak equity | Yes, on the daily loss limit across models | Consistency score gates the higher on-demand payout tier | “Risk Per Trade Idea” cap, funded stage only, aggregates re-entries | Unrestricted in evaluation; funded accounts restricted near high-impact news | Allowed in evaluation; funded accounts under a temporary restriction | Yes; per-trade cap and news and weekend rules activate once funded | Rules pages and payout terms |
| Blue Guardian | Daily loss limit plus trailing mechanics, varies by product | Yes, uses balance or equity, whichever is higher | Applies during evaluation; varies by product | “Guardian Shield” near 2% unrealized; first trigger cuts split, second closes | Broadly permitted in evaluation; short restricted window | Generally permitted, subject to plan rules | Yes; the floating loss shield and news restriction are documented | Blog and rules documentation |
| HyroTrader | Varies by plan; optional upgrade converts trailing daily | Yes, daily drawdown monitored in real time | Applies during evaluation only; drops away once funded | Mandatory stop-loss within 5 minutes of every trade, monitored live | Holding through news permitted; news-only strategies restricted | Permitted at every stage, reflecting 24/7 crypto markets | Yes; the consistency requirement applies only during evaluation | Terms and FAQ |
| Velotrade | Fixed, disclosed from initial balance | No secondary floating loss cap published | None at any stage, per published rules | None published beneath the daily limit | Permitted at every stage, per published rules | Permitted at every stage, per published rules | No; rules stated as consistent from purchase | Single published rules page |
Source: each firm’s own published rules pages, help-center articles and FAQs, captured July 2026. “Varies by product” means the answer differs across a firm’s account types. Terms change frequently, so confirm current conditions before purchasing.
Where the established names still hold an edge
The report is frank about the other side of the ledger. As a prop firm, Velotrade is new, having launched its challenges in 2026, while FTMO (2015) and Topstep (2012) have run trader evaluations for far longer. Paying funded traders at scale is something only time can prove, and on that count the incumbents hold years of history while Velotrade is early. Several firms also scale funded accounts well past Velotrade’s $200,000 ceiling and support more platforms. A clean rulebook can be built from day one; a payout track record cannot, and the report says to weigh both.
A ten-minute check before buying a challenge
The report’s practical takeaway is that ten minutes spent reading the terms may count for more than any comparison of profit splits. Drawing on its review of six prop firm rulebooks, it tells traders to check:
- Drawdown mechanics: fixed from the starting balance or trailing your equity? If trailing, end-of-day or tick-by-tick, and when does it lock?
- Consistency rules: at evaluation, when funded, or both? Tied to a payout tier? What is the exact single-day cap?
- Per-trade caps: is there a secondary cap below the daily limit, is it measured on unrealized losses, and does it pool re-entries?
- Funded-stage changes: do rules switch on, tighten or fall away once funded, and does the account open at a reduced balance?
- Payout conditions: minimum trading days, how often you can withdraw, any wait before a first payout, and whether a payout can be refused at the firm’s discretion.
- Where it is written: are all account-ending rules on one page, and can support point to each of them in writing?
Regulators are starting to ask the same thing
Scrutiny is building. The US Commodity Futures Trading Commission is expected to open a public consultation on 1 August 2026 (comments close 30 November 2026) on whether challenge fees amount to “commodity-pool participation interests”, a label that could bring evaluation-based US futures prop firms under CFTC and NFA registration. In Europe, the FCA and ESMA have restated that prop marketing to retail must carry prominent risk warnings and drop misleading performance claims, and regulators across Europe, Australia and North America are weighing whether charging a fee without providing funding looks like a pay-to-play model.
None of this is settled law, and some bodies, including CySEC and, for now, ESMA, have signalled that prop trading is not an immediate priority. But the direction of travel is toward standardised, upfront disclosure, the same shift most other consumer financial products have already made.
The takeaway
The report’s conclusion is that the prop model itself is sound, since backing skilled traders with firm capital is a reasonable idea. What lags behind is disclosure at the point of sale. Comparing rulebooks, it argues, deserves at least the weight traders give to comparing profit splits, because the rulebook, in the end, decides whether the split is ever paid.
About Velotrade
Velotrade is a proprietary trading firm offering funded trading challenges across crypto, forex, stocks, indices and commodities, built around a single, fully published rulebook and a fixed drawdown model. The firm puts transparency at the center of its offering, aiming to ensure that every rule capable of ending an account is disclosed in one place before a trader buys. Velotrade Re Limited is incorporated and registered in Hong Kong, where its founding team has operated a licensed invoice-finance business since 2016, with founders drawn from JP Morgan, Bank of America and Dresdner Kleinwort. All trading services are provided in a simulated environment using demo accounts with simulated funds. For more information, visit velotrade.com.
