Research
When Did Prop Firms Start? A Short History
A short history of prop firms: bank prop desks and the Volcker rule, Topstep in 2012, FTMO in 2015, the 2024 platform shock and the 2025–26 consolidation.
- By PipValley Editorial
- Published
- 4 min read
History matters to a founder because each era left rules behind. Platform clauses, payout caps, simulated-trading disclosures and restricted-country lists all exist because something went wrong for someone earlier.
What are the milestones?
| When | What happened |
|---|---|
| Before 2010 | Banks and independent firms trade their own capital through proprietary desks |
| 2010 onward | The Volcker rule (Dodd-Frank section 619) generally prohibits banking entities from proprietary trading |
| 2012 | Topstep founded as TopstepTrader; its Trading Combine is an evaluation (renamed Topstep in 2020) |
| 2015 | FTMO begins operating, per its own site |
| August 2023 | CFTC freezes MyForexFunds |
| February 2024 | MetaQuotes moves against prop firms with US clients; 80 to 100 firms close that year |
| May 2025 | CFTC case against MyForexFunds dismissed with prejudice |
| September 2025 | Kraken completes its acquisition of crypto prop firm Breakout; FTMO says it has paid $450 million over 10 years |
| December 2025 | FTMO completes its acquisition of OANDA |
| 2026 | ProjectX becomes Topstep-only (Feb 28); Topstep Brokerage launches (Jan); cTrader stops US prop onboarding (Jul 1) |
Why did the model grow so fast?
Because it removed the trader's biggest barrier, capital, and replaced it with a fee and a test. White-label technology then removed the founder's barrier: by the early 2020s a new brand could rent a platform, challenge engine and dashboard and launch in weeks. That is also why the market became crowded so quickly.
The scale today would have been hard to imagine in 2012. FTMO's homepage now says it has paid more than $650 million in rewards, and Prop Firm Match tracked about $325 million in payouts across connected firms in 2025 alone, per Finance Magnates. Futures, which Topstep pioneered, now make up roughly half the industry by Finance Magnates' account.
What does history teach a new founder?
- Platforms are rented; every era has had a platform shock.
- Regulators notice growth; disclosures that seemed optional became standard.
- Consolidation follows booms; the survivors are firms traders trust.
Questions
What was the first prop firm?
Proprietary trading desks long predate evaluation firms. Among evaluation firms, Topstep (founded 2012) is often called the first modern one, though that is a characterization rather than a settled fact.
How long has FTMO been around?
FTMO says it has operated since 2015. In September 2025, its co-founder said the firm had paid out $450 million over 10 years, per Finance Magnates.
Why did so many prop firms appear after 2020?
White-label technology let new brands launch in weeks without building a platform, and demand for evaluations grew fast. Low barriers also explain the closures that followed in 2024.
Sources
- Federal Reserve: Volcker rule
- Wikipedia: Topstep
- FTMO: homepage and simulated-account disclosure
- Willkie Compliance Concourse: New Jersey federal judge dismisses forex case with prejudice
- Finance Magnates: Prop trading firms' renaissance: cutting US clients, integrating new trading platforms
- Finance Magnates: 80–100 prop firms wiped out in 2024's industry collapse
- Business Wire: Kraken completes acquisition of Breakout to offer prop trading to clients globally (Sep 4, 2025)
- Finance Magnates: FTMO's parent netted over $62 million on $329M revenue in 2024 (Nov 14, 2025)
- Finance Magnates: FTMO closes OANDA acquisition deal after ten months
- Finance Magnates: ProjectX to end its third-party service offering (Nov 17, 2025)
- TradeInformer: Topstep launches introducing broker through Plus500 partnership
- Finance Magnates: cTrader restricts US prop firm access following internal regulatory assessment
- Finance Magnates: Prop Firm Match tracked about $325 million in payouts in 2025
- Finance Magnates: Prop trading is finding its way back to the US, but can it beat futures dominance?
- TradeInformer: Topstep made "more than $25m" in 2020 and 2021
Illustrative figures, not a forecast. Nothing on this site is legal, tax or financial advice. PipValley is a web design studio; we don’t sell challenges, run trading accounts or provide trading platforms. Spotted something out of date? Tell us and we’ll fix it with the date.
Keep reading
Related guides.
What Is a Proprietary Trading Firm? Old Model vs New
What Is a Prop Firm? The Operator's Definition
Are Prop Firms Going Away? Where the Industry Is Heading
How Many Prop Firms Are There in 2026?
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