Chaotic
shifts in the prop trading market in 2024, driven in part by MetaQuotes, have
led 7 out of 10 retail investors to call for regulation, according to the
latest PipFarm survey exclusively seen by Finance Magnates. At the same time, the company’s CEO, James Glyde, openly
admits that the MetaTrader platform provider, through the “denunciation” of the
prop trading challenge business model, “did a huge favor for their
competitors.”
Prop
trading could once grow as dynamically as the retail FX/CFD market did, largely
due to the lack of regulation . However, it is now slowly becoming a victim of
its own success, and end users themselves note that placing this model within a
regulatory framework may be necessary.
Nearly 70%
of all respondents stated that prop firms should be regulated, while only 15%
considered it a bad idea. The remaining ones had no opinion on the matter.
According
to Glyde, “much of the credit” may lie with MetaQuotes. Its regulatory
crackdown on the industry in February 2024 caused some firms to suspend
operations or exit the market entirely, while the rest had to adjust their
offerings.
Blocking
access to MetaTrader “was hugely helpful for the firms that retained their
licenses and created a never-before-seen platform boom, greatly benefiting
cTrader, TradeLocker, MatchTrader, Sirix and DXtrade,” Glyde told Finance Magnates.
Transparency Comes First
Why do
traders want regulation? The PipFarm survey results show that 66% support the
implementation of reporting obligations and improved transparency, suggesting
that many investors and observers believe these measures can help deter
misconduct and promote informed decision-making.
The survey
further revealed that 57% of participants favor establishing business conduct
requirements and best practices, emphasizing the need for clear guidelines to
shape ethical behavior and fair competition. Meanwhile, 56% believe regulators
should focus on strict enforcement, including the punishment of violations and
issuing public warnings.
About 44%
want regulators to examine owners’ financial resources, seeing it as essential
to ensuring stability and risk management within proprietary trading
operations.
MetaTrader Still Reigns
Supreme
Although
MetaQuotes has significantly restricted access to the MetaTrader 5 and 4
platforms, PipFarm data indicate that they remain the most popular tools among
traders for prop trading.
A full 62%
of respondents reported that MetaTrader 5 is their preferred platform, while 9%
favor MetaTrader 4. cTrader has definitely benefited from recent developments,
as 27% of respondents chose it.
“This event
[MetaQuotes crackdown] also drove the broker-backed trend, where brokers took
advantage of their MT4/5 licenses,” added the PipFarm CEO.
Glyde
refers to a trend from last year, in which numerous FX/CFD brokers holding
MetaQuotes licenses identified a business opportunity in prop trading and began
offering the model themselves. Among these were OANDA, Hantec, and Axi, with
ATFX joining later in the year.
Who Is the Average Joe of
Prop Trading?
Based on
the PipFarm survey results, the average prop trading firm client resides in an
emerging economy (with India, Nigeria, and Indonesia dominating), began their
involvement in this sector relatively recently (over 60% after 2023), and
believes that funded traders should be A-booked (36%) rather than steered
toward artificially created markets on demo accounts.
The
greatest concerns when working with a prop trading firm include payout
rejection (44%) and hidden rules (32%). Additionally, 36% believe that prop
firms often change their rules without sufficiently clear communication or a
rationale that benefits both parties.
“Fewer
people believe prop trading is a cash cow fed by a marketing machine. Prop
trading is a tough business model to manage, and it will only get tougher if
trust dwindles as more firms fall,” added Glyde.
At the same
time, this average client is willing to pay an additional $20 for more
favorable trading conditions or challenges (54%) and believes that prop firms
with consistent rules are healthier (52%). Scaling programs (83%), which
gradually increase trading capital, are also very important to them.
60% of Clients Lose Money
An earlier
PipFarm survey conducted in the middle of last year found that only 40% of the company’s
clients made a profit, with an average challenge cost exceeding $4,000.
In another
survey from November 2024 focusing on opinions about technological solutions, 3
out of 5 respondents indicated that broker-backed prop firms are more
trustworthy.
All three polls
from recent quarters paint a coherent picture: clients want clear rules,
regulation, and trusted partners. At the same time, as in other financial
markets, success is reserved for only a few. This is confirmed by a separate
survey conducted by FPX Tech, a technology service provider for prop trading,
which, based on 300,000 prop accounts, determined that only 7% achieve a
payout.
What Will 2025 Bring?
Glyde
predicts that 2025 will bring a series of significant yet necessary reforms to
the proprietary trading model.
“Overcompetition
caused the industry to push prices and rules to the absolute limit, giving
traders and cheaters far too much of an edge in this model,” he commented.
This
landscape has swept many participants from the market and caused considerable
collateral damage. Firms with strong leadership now recognize that prop trading
rules must be recalibrated to remain fair and sustainable, ensuring that both
firms and traders can thrive under a more balanced system.
At the same
time, what firms consider fair and what traders will accept may not always
align, prompting questions about where the industry will draw the line.
“Could it
be time limits, consistency scores, profit caps, trailing drawdown, buffers, or
something else?” Glyde concluded.
The coming
years will likely reveal whether prop trading truly has the potential to
dominate the retail space or evolve into another niche within the broader
financial sector.
The data in
this article is based on a survey conducted by PipFarm in January 2025, which
gathered responses from 3,127 company’s clients worldwide.
Chaotic
shifts in the prop trading market in 2024, driven in part by MetaQuotes, have
led 7 out of 10 retail investors to call for regulation, according to the
latest PipFarm survey exclusively seen by Finance Magnates. At the same time, the company’s CEO, James Glyde, openly
admits that the MetaTrader platform provider, through the “denunciation” of the
prop trading challenge business model, “did a huge favor for their
competitors.”
Prop
trading could once grow as dynamically as the retail FX/CFD market did, largely
due to the lack of regulation . However, it is now slowly becoming a victim of
its own success, and end users themselves note that placing this model within a
regulatory framework may be necessary.
Nearly 70%
of all respondents stated that prop firms should be regulated, while only 15%
considered it a bad idea. The remaining ones had no opinion on the matter.
According
to Glyde, “much of the credit” may lie with MetaQuotes. Its regulatory
crackdown on the industry in February 2024 caused some firms to suspend
operations or exit the market entirely, while the rest had to adjust their
offerings.
Blocking
access to MetaTrader “was hugely helpful for the firms that retained their
licenses and created a never-before-seen platform boom, greatly benefiting
cTrader, TradeLocker, MatchTrader, Sirix and DXtrade,” Glyde told Finance Magnates.
Transparency Comes First
Why do
traders want regulation? The PipFarm survey results show that 66% support the
implementation of reporting obligations and improved transparency, suggesting
that many investors and observers believe these measures can help deter
misconduct and promote informed decision-making.
The survey
further revealed that 57% of participants favor establishing business conduct
requirements and best practices, emphasizing the need for clear guidelines to
shape ethical behavior and fair competition. Meanwhile, 56% believe regulators
should focus on strict enforcement, including the punishment of violations and
issuing public warnings.
About 44%
want regulators to examine owners’ financial resources, seeing it as essential
to ensuring stability and risk management within proprietary trading
operations.
MetaTrader Still Reigns
Supreme
Although
MetaQuotes has significantly restricted access to the MetaTrader 5 and 4
platforms, PipFarm data indicate that they remain the most popular tools among
traders for prop trading.
A full 62%
of respondents reported that MetaTrader 5 is their preferred platform, while 9%
favor MetaTrader 4. cTrader has definitely benefited from recent developments,
as 27% of respondents chose it.
“This event
[MetaQuotes crackdown] also drove the broker-backed trend, where brokers took
advantage of their MT4/5 licenses,” added the PipFarm CEO.
Glyde
refers to a trend from last year, in which numerous FX/CFD brokers holding
MetaQuotes licenses identified a business opportunity in prop trading and began
offering the model themselves. Among these were OANDA, Hantec, and Axi, with
ATFX joining later in the year.
Who Is the Average Joe of
Prop Trading?
Based on
the PipFarm survey results, the average prop trading firm client resides in an
emerging economy (with India, Nigeria, and Indonesia dominating), began their
involvement in this sector relatively recently (over 60% after 2023), and
believes that funded traders should be A-booked (36%) rather than steered
toward artificially created markets on demo accounts.
The
greatest concerns when working with a prop trading firm include payout
rejection (44%) and hidden rules (32%). Additionally, 36% believe that prop
firms often change their rules without sufficiently clear communication or a
rationale that benefits both parties.
“Fewer
people believe prop trading is a cash cow fed by a marketing machine. Prop
trading is a tough business model to manage, and it will only get tougher if
trust dwindles as more firms fall,” added Glyde.
At the same
time, this average client is willing to pay an additional $20 for more
favorable trading conditions or challenges (54%) and believes that prop firms
with consistent rules are healthier (52%). Scaling programs (83%), which
gradually increase trading capital, are also very important to them.
60% of Clients Lose Money
An earlier
PipFarm survey conducted in the middle of last year found that only 40% of the company’s
clients made a profit, with an average challenge cost exceeding $4,000.
In another
survey from November 2024 focusing on opinions about technological solutions, 3
out of 5 respondents indicated that broker-backed prop firms are more
trustworthy.
All three polls
from recent quarters paint a coherent picture: clients want clear rules,
regulation, and trusted partners. At the same time, as in other financial
markets, success is reserved for only a few. This is confirmed by a separate
survey conducted by FPX Tech, a technology service provider for prop trading,
which, based on 300,000 prop accounts, determined that only 7% achieve a
payout.
What Will 2025 Bring?
Glyde
predicts that 2025 will bring a series of significant yet necessary reforms to
the proprietary trading model.
“Overcompetition
caused the industry to push prices and rules to the absolute limit, giving
traders and cheaters far too much of an edge in this model,” he commented.
This
landscape has swept many participants from the market and caused considerable
collateral damage. Firms with strong leadership now recognize that prop trading
rules must be recalibrated to remain fair and sustainable, ensuring that both
firms and traders can thrive under a more balanced system.
At the same
time, what firms consider fair and what traders will accept may not always
align, prompting questions about where the industry will draw the line.
“Could it
be time limits, consistency scores, profit caps, trailing drawdown, buffers, or
something else?” Glyde concluded.
The coming
years will likely reveal whether prop trading truly has the potential to
dominate the retail space or evolve into another niche within the broader
financial sector.
The data in
this article is based on a survey conducted by PipFarm in January 2025, which
gathered responses from 3,127 company’s clients worldwide.
