How it All Started.
I started trading on Topstep in June 2024. I knew I would be in for a bit of a journey and learning curve. I don’t think I was fully aware of what I was signing up for. Not in a literal sense, but I thought I could just copy and paste my system and strategy from crypto (and other markets) to prop firms. Boy, I was wrong.
My Past Experience With Props.
For complete transparency, I had only tried out props twice previously. Once back in 2022, when FTMO was massive (still are massive fwiw and coming to futures soon). They had a two step evaluation process. I passed both. Then, failed right after passing. I don’t think I ever got a payout there. I was so occupied with crypto. It wasn’t a priority to me. I wasn’t ‘locked in’. I was just using FTMO for any forex/indices trades. 99.9% of my trading capital was tied up in crypto. So props were the logical option to get some cheap leverage.
July 2022, I knew the window of time was closing in for crypto. I booked my exit over there. But I still wanted to make this prop thing out. It bothered me “taking the L” on props. I knew I could win there. It was right around the launch date for MFFU. I remember going back and forth messaging MattL about doing promo for MFFU. He wanted me to do promo for MFFU. I agreed. I didn’t really have a presence on Twitter. I did have a pretty massive audience on Discord. I didn't hear back from him for like a week. He sends me a message out of the blue. “We launch tomorrow 🙂We launch tomorrow 🙂” Yes, twice. He sent me the details and I got my account. Traded it for a few weeks. Ended up failing the evaluation. The rules really sucked. I still wrote him a TrustPilot review. But it was hard. very very hard rules. I vaguely remember struggling to figure out what was going on. It felt like entering a maze. decoding all of the rules and combing through the knowledge base. That was it for my prop trading experiment and journey into the space, I thought.
The Return.
Fast forward to June 2024, I see Topstep is getting massively popular. I started watching TopstepTV. Just a few days a week to start. It seemed like a cool idea to try it out. I was at a good point in my life and trading career. I took a good part of 2023 off from the charts and screens. When the crypto markets started going down, it brought out all the bad actors. This was right after FTX collapsed and crypto died. The people that were left in crypto were all “extractors” and just explicitly scamming. **At that point in time, I didn't know if crypto would ever recover. The sentiment was just that bad.
I had made some really insane crypto investments in 2024. Caught a lot of the move back up in crypto and made some great early stage investments. This isn’t a crypto book or even a book about my trading journey, so i’ll refrain from all the details. But, I was doing pretty good. There was still this longing to want to make prop firms work for me.
Back to Topstep, TopstepTV was putting on an entertaining show. It really was what got me to dive deeper into props. After spending a few weeks watching, there was one thing that struck me though. and maybe this is the ego talking. A better description might be confidence mixed with a bit of delusion. But as I watched more and more TSTV, I thought to myself I was a better trader than everyone on there. I didn’t think they were great traders. Sure, they did put on a great show. It was entertaining. It did draw a lot of people into the space. It did bring life to the ‘boring thing’ that is trading. I didn’t really know shit about prop firms. But I knew I could trade. And if I put the effort and the work into Topstep, I would succeed.
And really that success started as just wanting to make a few thousand dollars a month. I didn’t start off with crazy goals or targets. More so, how can I turn this into consistent income that would flow into my bank account each month as pretty much my entire NW was on a USB stick (in truth, multiple USBs. I digress.)
I started buying evaluations on Topstep. Honestly, not too many. I took it pretty slow. I was really just trying to start to learn the game. On a personal note, I didn’t have a massive credit limit. So I was forced to take it slow. With my other personal expenses, I maybe had $5,000 a month left in ‘credit’ to pay my prop “tuition.”
A couple of months went by and it was around September 2024 at this point, I hadn’t seen any success. It was puzzling to me. Because I would be watching these traders on TSTV make money, and I knew I was better, but there were no results to prove it. I watched payouts pile up every day on TV. It’s hard to see that and question what you are doing wrong. I knew I had to be missing something. I wanted to give up at this point. I thought to myself, I was stupid for thinking I could just come into props and tear it up. I started doubting myself and my abilities. Was all of my past success really just a fluke or a one off luck spell? I wasted my time, energy, and close to $10,000 of my money on prop firms. I felt stupid.
This was really my breaking point.
I had hit rock bottom.
I had a decision to make. Give up or go all in.
I’m not a quitter, so I shoved all in.
What I learned from this is pretty simple:
Prop firms make money from you losing.
PROP FIRMS ARE ENGINEERED TO PUSH YOU INTO A FAILURE FUNNEL.
They put restrictions on you, give you rules to follow, and in the end very few make it out alive.
Prop Firms = Insurance Models.
The prop firms we trade are akin to insurance models. There is no real difference or distinction between them and insurance companies. Their ‘capital’ comes from you. If you lose, they win. If you win, they lose. Think insurance companies denying medical claims = prop firms denying payouts.
Some stats directly from Topstep’s website:
“ From January through December 2024, (a) 12.4% of all Trading Combines initiated were successfully completed and afforded the opportunity to advance to the Funded Level, (b) 46.6% of individual participants who entered a Trading Combine advanced to the Funded Level, (c) 28.3% of all individual participants at the Funded Level received a payout, and (d) 0.96% of individual participants trading in an Express Funded Account were called up to a Live Funded Account. ‘’
What does this tell you? If 12.4% of combines get passed, that means 87.6% of combines ‘fail.” Topstep collects $50, $100, or $150 from 100% of combines. And the 12.4% that do get passed, they collect another $150 in activation fees.
You’re playing a game where the odds are stacked against you. The odds are not in your favor. They do not want you to win. Actually, they want you to fail. They do not make money from you winning. The only firm that has explicitly mentioned they copytrade their top performing, profitable traders is Apex. (This is public information from an interview with the CEO in 2022. You can find it on YT, if interested in taking a deeper dive).
Now, Topstep does not provide the figure on individual evaluations to corresponding payout from that account. But, I can infer. It’s a really small fucking number. Pat yourself on the back if you have taken a payout before. Because you are in a select club. Almost 75% of prop traders never get a payout.
The rules are challenging. Make 9% to pass. Avoid 4.5% in drawdown. And when I was trading the combines, the MLL and DLL were not the same. It made it even harder to pass. Hit your daily loss limit (lose 3% in ‘account value’) on the first day, it’s gonna be a rough road ahead. Using that remaining 1.5%/$1500 to pass the eval and crawl back +$12,000. *I’m using the $150k account size for reference, but the logic is the same. It’s virtually impossible to do so. I would love to see the data from Topstep for traders that hit DLL first day and then passed the combine. As the current model stands and as of writing, it’s easier to pass evaluations.
Long story short, you’re gonna lose. You are going to have to pay your tuition. And for most people, that tuition is gonna cost you thousands of dollars.
It doesn’t help that the messaging comes off as appealing and enticing. It’s akin to any gambling site. For the uninformed trader, you think you are buying $50,000/$100,000/$150,000 in buying power. You would be mistaken. You’re not. You’re really buying $2,000/$3,000/$4,500 in drawdown. It’s good marketing. I’ll give it to them. Check any prop firm website. They all use the same language and ‘buzz words’. It feels like you just stumbled on guaranteed success. You think to yourself thousands in payouts should be flowing back to you in just a few trading days. It appears to look like this: $150 buy in cost. Thousands back in payouts. What could go wrong?
On a side note: This exact conversation happened to me back in June. “What do you do for work?” “I trade prop firms”. “Oh, I’ve seen that before, but I just figured it was a scam. There has to be a catch” Albeit it was an older guy (probably in his late 40s). But the takeaway here stands. It’s a marketing game. Most prop traders think they can get the hang of it quick. Trade it normally like any other personal account. They are usually wrong. *much more on this in later chapters
You should use your drawdown as leverage, not tuition. The same way a monthly gym membership works. You can go as often as you want during the month. But how many take full advantage of it? “Approximately 67% of gym memberships go unused.” You pay the gym for the equipment and to keep the lights on, but most do not take advantage of what they pay for.
Tight rules + reset fees = built-in fail rate = consistent profit for the firm. Short evaluation windows (now typically 1-2 days at most firms) increase churn even more. Back in my FTMO days, evaluations would take 5 days to weeks to pass. Now, you can lose an account in one candle. It’s by design. Increase the evaluation churn = drastically increase the firm profits.
Prop firms publish their rules upfront. They tell you the max loss limit, risk limits, payout caps, days required. But how many traders optimally plan for this? If you are not playing their game, the way they designed it, YOU ARE DOING IT WRONG. It’s not a scam. The game is transparent (for the most part), but misunderstood by traders. Most do not even think about the rules and the prop firm model before diving in. Resets are the model. Once you see it, you can’t unsee it. The house wins when you don’t play by the rules. Use the rules as the instructions. I repeat because it’s important to drill into your head, USE THE RULES AS INSTRUCTIONS.
Prop firms make money whether you lose or win small. What they don’t like is when you win big. So, it’s up to you to pick your side. In the next chapter, I'll explain how those rules shape your behavior when you’re playing their game.
PART I: UNDERSTAND THE GAME