😥Have Prop Firms Become an Addiction?

Let’s face it, prop firms are absolutely killing it. And why wouldn’t they be? The business model works - but only because most traders fail. If the majority were passing, the system would collapse. What keeps it going is the sheer volume of challenges being failed every single day.

The failure rate is at the extreme end, yet individuals keep throwing money at it like it’s a lottery ticket. The mentality of “this time will be different” or “I’ll stick to my rules” rarely holds up. Most aren’t even mentally prepared. Discipline breaks down. Full porting, revenge trading, overtrading - it’s a cycle that keeps repeating itself.

Spend five minutes on Reddit and you'll see the real numbers. Traders hiding behind anonymous usernames openly admit to losing dozens of accounts, some in the 80s. Eighty challenge accounts. That’s not persistence. That’s addiction.

And let’s be honest here, the firms won’t put a stop to it. Why would they? This kind of behaviour is what keeps them in business. The model thrives on desperation, false hope, and the idea that because it’s “not your money,” it’s somehow less risky. There's no mentor, no senior trader, no voice of reason to say, “You're not ready yet.”

Part of the blame lies with social media. A never-ending feed of influencers, many of whom have never traded a real account in their life, flexing rented cars, designer watches, and fake profits. They’re not traders. They’re affiliate marketers, earning commission off every challenge link clicked. And unfortunately, the dream they’re selling is tailor-made for those who are young, impressionable, and fed up with the 9 to 5.

So what’s the solution?

There isn’t one. It’s a mental battle each trader has to face on their own. Until that self-awareness kicks in.

And this isn’t a call to cancel prop firms. The model has its place. For a skilled, disciplined trader, they offer opportunity and access to more capital than they might otherwise raise. But for the vast majority, it’s become a treadmill, one they can’t get off.

Prop firms could do more, but doing so would hit the bottom line. To be fair, a few well-established firms have started taking small steps in the right direction. They’re not eliminating the behaviour, but they’re at least trying to help traders rein in those compulsive urges.

A challenge cap could help, in theory. But in reality, the trader would just hop to the next firm. So while firms can offer guidance, limits, or even basic friction, they can’t stop someone who doesn’t want to stop.

At the end of the day, it’s up to the individual.

If you’re new to trading or are constantly blowing accounts, maybe the better play isn’t another challenge. Maybe it’s stepping back, rethinking your edge, going back to demo, or learning how to manage $500 of your own money before dreaming about managing $50,000 of someone else's. Because if you can't grow $500, you definitely can't grow $50,000, no matter what the Instagram or TikTok mob tell you.

Until that reality clicks, the addiction will continue.