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.”

The Unregulated Prop Trading Industry Calls for Oversight

Prop trading could once grow as dynamically as the retail FX/CFD market did, largely due to the lack of regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term. 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 Marketing Marketing is defined as the business process of identifying, anticipating and satisfying customers' needs and wants.This is a crucial element of any operation or brokerage in the financial services space. Well-funded marketing campaigns are instrumental to the survival and longevity of these companies in an increasingly competitive industry.Within the forex space, marketers perform a wide range of functions to help procure, secure, or retain clients.In particular, newer forex brokers also have t Marketing is defined as the business process of identifying, anticipating and satisfying customers' needs and wants.This is a crucial element of any operation or brokerage in the financial services space. Well-funded marketing campaigns are instrumental to the survival and longevity of these companies in an increasingly competitive industry.Within the forex space, marketers perform a wide range of functions to help procure, secure, or retain clients.In particular, newer forex brokers also have t Read this Term 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.