Disclaimer: The below article is sponsored, and the views in it do not represent those of ZyCrypto. Readers should conduct independent research before taking any actions related to the project mentioned in this piece. This article should not be regarded as investment advice.
Clearing a funded challenge, exiting a position in profit, and then losing the account anyway sounds like bad luck. But often it isn’t a loss at all that ends it — it’s a term the trader never read before paying. And it’s far from rare: of more than 300,000 funded accounts examined, only around 7% of traders ever withdrew a payout — and the cause was seldom their trading.
That gap is the focus of Velotrade’s 2026 Prop Firm Transparency Report, which went through the published rulebooks of six firms, Topstep, FTMO, FundingPips, Blue Guardian, HyroTrader and Velotrade, to identify the terms that really decide whether a funded trader walks away with their profits. Its message is plain: traders obsess over profit splits, while the clauses tucked into evaluation guides and help-center pages are what quietly end most accounts.
Rules close more accounts than losing trades do
Two independent industry datasets sit behind that claim:
- In a 2024 study by FPFX Tech covering more than 300,000 accounts (reported via Finance Magnates), only 7% of traders ever reached a payout, and just about 14% cleared a challenge to start with.
- A separate hoc-trade review of 500,000 traders found roughly 70% of failures traced to breached loss limits, not to missed profit targets.
- Consistency rules can cancel out 33% to 50% of the profit made on one strong day. Four of the six firms examined use one.
The signal is the same throughout: 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.
Booming demand, collapsing firms
Interest in funded accounts has jumped even as the roster of firms shrank. Monthly searches for “prop firm” rose from around 880 in early 2020 to about 49,500 by 2025, a 56-fold increase, pulling successive waves of first-time buyers into a market where the terms that matter most are kept off the sales page.
The rest of the picture is grim. After MetaQuotes stripped MT4 and MT5 licenses from prop firms serving US clients in February 2024, several major names folded. The Funded Trader halted operations and later owned up to more than $2 million in denied payouts. True Forex Funds closed over insolvency, leaving around 300 traders owed $1.2 million. SurgeTrader shut its doors within days, its CEO acknowledging that about 10% of payout obligations went unpaid.
One trade, two firms, two very different endings
Every prop account carries a maximum-loss line, but firms set it in fundamentally different ways, and that difference can decide the very same trade two different ways. A fixed drawdown is pegged to the starting balance and does not move: on a $100,000 account with a 10% limit, you fail at $90,000, no exceptions. A trailing drawdown rises with your equity and never drops back.
The report runs a single account through both. A normal day-seven pullback troughs about $10,000 above a fixed $90,000 floor, so the account is never in jeopardy and ends up roughly $6,500 ahead. Under a trailing floor that has climbed near the peak, that identical dip crosses the line and closes the account outright. FTMO pegs its maximum loss to 10% of the starting balance; Topstep’s trailing limit rises with the end-of-day balance and locks at the start. Neither firm hides its model, but fixed versus trailing is no footnote. It decides the trade.
Penalised for a strong day
A consistency rule limits how much of your total profit may come from any single session. Trade too well, too fast, and you fail anyway. With a 40% single-day cap and a $1,000 target, a $450 session is 45% of profit, past the line, so the evaluation fails even though the target was reached.
Topstep, FundingPips, Blue Guardian and HyroTrader each run a version, at evaluation or on a payout tier. FTMO applies a 50% Best Day Rule on its 1-Step product, recorded in its help center rather than the headline rules. And the tightest single-day caps usually attach to the most appealing payout options. Velotrade says it applies no consistency rule at any stage. For readers sizing up the crypto-focused end of the market, Velotrade’s rundown of the top crypto prop firms sets these terms out together.
The rule that can close a winning trade
Loss limits end the most accounts. But the report picks out a quieter rule as the hardest to see coming, because it can close an account on a trade that never settles at a loss.
A max-risk-per-trade rule limits how much any single position or trade idea may lose at any point, measured on unrealized, floating, profit and loss, not on closed trades. It sits beneath the advertised daily loss limit. If an open trade’s paper loss even touches the cap intraday, however briefly, the rule can fire and the account is over, even if that trade would later have closed in profit.
Three things make it easy to overlook at checkout:
- It tracks unrealized loss. Your trade never needs to close red.
- It may activate only after funding. You can pass the whole evaluation without ever hitting the rule that then governs your funded account.
- It may combine re-entries. Close a losing trade and reopen in the same direction, and the losses are pooled toward the cap.
Firms give it different names. 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 combines 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 unreasonable as risk management. The report’s point is placement: a rule that can end a funded account arguably belongs next to the price, not several pages deep in a help center.
Six rulebooks, side by side
The full rulebook comparison ranges all six firms against the terms that most often decide a payout. Because 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 are advised to check 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 older firms still come out ahead
The report is candid about the flip side. 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 proves, and on that score the incumbents carry 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 advises weighing both.
Ten minutes to check before buying a challenge
The report’s practical takeaway: ten minutes with 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 initial balance or trailing your equity? If trailing, is it end-of-day or tick-by-tick, and when does it lock?
- Consistency rules: evaluation, funded, or both? Attached to a payout tier? What exactly is the single-day cap?
- Per-trade caps: is there a secondary cap under the daily limit, is it measured on unrealized losses, and does it pool re-entries?
- Funded-stage changes: do rules turn on, tighten or vanish once funded, and does the account begin at a reduced balance?
- Payout conditions: minimum trading days, how often you can withdraw, any wait before the first payout, and whether a payout can be turned down 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 circling the same question
Scrutiny is mounting. 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 count as “commodity-pool participation interests”, a designation that could bring evaluation-based US futures prop firms under CFTC and NFA registration. In Europe, the FCA and ESMA have repeated that prop marketing to retail must carry prominent risk warnings and drop misleading performance claims, and regulators across Europe, Australia and North America are examining whether charging a fee without delivering 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 prop trading is not an immediate priority. But the direction of travel points to standardised, upfront disclosure, the same shift most other consumer financial products have already made.
The bottom line for traders
The report’s conclusion is that the prop model itself is sound, since backing skilled traders with firm capital is a reasonable idea. What trails behind is disclosure at the point of sale. Comparing rulebooks, it argues, deserves at least as much weight as 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.
Be the first to comment