State of the Prop at FMLS:25 — The Easy Money Reckoning

Prop trading is no longer a niche. While brokers launch prop services, many established platforms now generate tens to hundreds of millions of dollars in revenue solely from their prop businesses.

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The Finance Magnates London Summit panel, “State of the Prop 2026,” will explore the intricacies of the prop industry – its present reality and its future prospects.

Moderated by Finance Magnates’ Editor-in-Chief, Yam Yehoshua, the panel participants – Gil Ben Hur, founder at The5ers; Brian Griffin, CEO of Kubera Markets; Alexis Droussiotis, Head of Match-Trader Platform at Match-Trade Technologies; and Christian Georgen, Marketing Consultant at FYI – will bring broad insights from different perspectives

“What started as a niche model is now one of the hottest topics in the industry and is on the radar of brokers, service providers, and partners alike,” said Georgen.

The industry has thrived over the last few years. The entry of brokers into the space has strengthened the future prospects of props. However, the intention of contracts for differences (CFDs) brokers might not be to offer a pure prop model. Instead, it has become a potential marketing channel for brokers.

“Prop trading is increasingly becoming a strategic funnel for brokers,” said Droussiotis.

“With its lower barrier to entry and higher profit potential for traders, at just the risk of the challenge fee, it attracts a much wider audience. Many of these prop traders eventually move on to FX trading, making prop a powerful acquisition and conversion channel rather than a standalone model.”

Is the Charm of Prop Gone?

While the prop business appears lucrative with a low entry barrier on the surface, the truth about survivability is different. Prop firms are closing down in record numbers. Some influencer-driven prop shops have even closed within months of their launch.

The reason? Risk management.

Prop firms cannot follow the risk management playbook of CFDs brokers. B-booking is not only the preferred way, but in many scenarios, it is the only way to survive. This has also reignited comparisons between prop firms and binary options.

“Whether it develops into the next binary options or establishes itself as a respected form of trading for retail clients depends on many factors. For the next stage of growth, changes in marketing, product offerings, and overall transparency will be required.”

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Furthermore, the widespread exits of prop brands have raised questions about whether the model is sustainable in the long run.

“Like CFD brokers in years long since past, prop providers are realising that as soon as you think you have a handle on it, it’s gone,” said Griffin.

“Any competitive edge you think you had, with a perceived low cost barrier to entry, saw lots of new pretenders to the crown entering the marketplace. But every single one entered the marketplace as a participant, not a change agent.

The result was, and still is, relentless downward pressure on prop challenge purchase prices, coupled with ‘fiddling’ with the challenge rules to at least give the impression of innovation.

"However, nothing really changed, and the industry’s true Achilles’ heel – the over-reliance on challenge fees as the only source of revenue for 90% of prop providers – is seeing many sink before they complete their first year of operation.”

“Any successful prop providers are now advertising arbitrageurs for their funding master – their CFD parent.”

The panelists are also expected to address the rampant fraud that has engulfed a major portion of the prop trading industry.

Many industry insiders have confirmed that they were forced to block traders from certain geographies and even revamp their verification rules to eliminate the issue of coordinated trading by groups on prop platforms.

These issues have also pushed the prop platforms to build more holistic approach for their operations.

The5ers' Hur also confirmed that he has "so much to say about the maturing industry."