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  • #19,881
  • Sep 2, 2023 6:11am Sep 2, 2023 6:11am
Quoting Capablanca
{quote} Completely disagree. No prop would survive executing all trades in real market because most of traders are losers. That's why MFF and other props (and B brokers) had/have a profitable business. Overall there are more people losing than winning.
You are free to disagree. There have always been succesful prop companies. This Ponzi industry most people call prop industry is just a Ponzi scheme mostly. There is a few good companies but they have a strict rules, healthy profit sharing and realistic evaluation program. One thing to keep in mind is that you dont need to trade in real markets at evaluation phase. Only when traders are granted permission to trade and have a share of profits.
  • #19,882
  • Sep 2, 2023 6:13am Sep 2, 2023 6:13am
Quoting LehmanBrotha
with this info about MFF and business practices coming into light- which is something quite a few of us in this topic already suspected Imagine how it looks with old Finotive rules where you had to cover previous losses before receiving profit splits of new accounts "hello, we cannot pay your imaginary winnings because you previously made imaginary losses"
This is, by far, the best post I read since all this saga started. I'm still laughing.

You nailed it, mate.

(some naves will come in denial and say that's because Finotive is a real one, providing real money).
  • #19,883
  • Sep 2, 2023 6:14am Sep 2, 2023 6:14am
Another problem is the unfair executions from MFF as they delayed orders and added slippage and worst they also had custom settings to successful traders, so typically all features of Virtual Dealer Plugin, like it was common earlier on MT4 on less reputable brokerages. And it was forbidden later so here is a good point for the CFTC to punish MFF.
  • #19,884
  • Sep 2, 2023 6:16am Sep 2, 2023 6:16am
Quoting TrAndy1
{quote} But no of those prop has own money. They have max. outside investors like FTMO for example is telling us. So they match investors with traders and then BOOM, you need a full license as prop. And that even can cause problems as trader you want to take part here. Only if they are operating like hedge funds then you are fine as trader and not need any licenses. But which FX prop firm can do this ? Maybe only FTMO.
you are right that most of these prop firms = Ponzi schemes have no money. I am just saying that if you do your research you can find real props with real traders making real money and losing real money. The terms are not as attractive but all Ponzi schemes are always fueled by peoples greed.
  • #19,885
  • Sep 2, 2023 6:17am Sep 2, 2023 6:17am
Quoting Capablanca
{quote} To me Ponzi is to promise some reward that you cannnot deliver. In other words, a business not able to be sustained long term. You pay old investors with new subscription until it blows up. Gambling is paying the winners with the money from the losers and keeping some % (like roulette, slot machines, etc.). This is not a ponzi. This is a business that is sustainable long term, without busting (casinos, for example). I think MFF was a gambling business, not a ponzi one.
In gambling you can only win what's on the "table"
If all participants win the pot is split

In a Ponzi scheme you are promised and able to win more than what's on the "table" because the missing sum is paid by "another table"
If all MFF participants would have been successful MFF couldn't pay the promised 125% fee refund +profits ... So MFF is Ponzi not gambling business
Muni loves you all!
  • #19,886
  • Edited 6:30am Sep 2, 2023 6:17am | Edited 6:30am
I have to admit, after reading the details in the CFTC charging doc with the smoking gun internal txts/emails... the realization that 50% of my funding (675K with scale ups) + a mid 5 figure payout is going up in smoke really put me in a bad mood for the rest of the day.

EU/UK/CA/US Regulators can easily completely wreck the current retail prop industry within their jurisdictions.

Offshore Prop?

There are many attack vectors determined regulators can pursue to take their knees out too... Think markets, Purple trading, Eightcap, Credit card processors, Deel., server hosting co ect.
  • #19,887
  • Sep 2, 2023 6:22am Sep 2, 2023 6:22am
Quoting inversio
{quote} totally agree with u. no one is honest here. but degree of honesty matters. even reputed forex broker also got fineed bcz of their tweaking, fxcm , oanda, forex.c etc. here in this sector 100% honest firm is almost not exist. if u check the business model, firms revenue generates form 2 things, 1. challenge fee, 2. profit from live trading. here if a firm don't generate any profit from trading, how long do u think they can pay from the fees only. not long. and this is ponzi. on other hand if a firm generates from both action, and use some...
Two points:
1. You ask how long they are able to survive if they don't trade live, just using fees. I think they may survive forever because I believe (not 100% sure) that collected fees upfront are enough to cover the total payouts. Just like a casino.

2. Regarding broker, we know that 8crap has ready to use packages for firms. It is more costly to setup their own server. So, we can see this from a different angle: the scammers will use a "ready to use" solution like 8crap, while the ones trying to be for the long term prefer to invest in infrastructure.
I think the broker is no indication of anything. We can read both ways. TPT has their own and gone down. Funding Talent used Purple and went bust. Funded Next uses a established 8crap and is full of tricks.
  • #19,888
  • Sep 2, 2023 6:24am Sep 2, 2023 6:24am
It sucks to get through a game and now wait for news on 9/11.
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  • #19,889
  • Sep 2, 2023 6:29am Sep 2, 2023 6:29am
Quoting Capablanca
{quote} This is, by far, the best post I read since all this saga started. I'm still laughing. You nailed it, mate. (some naves will come in denial and say that's because Finotive is a real one, providing real money).
Devious but brilliant from their side....gotta give them some credit.

I remember their aggressive emails to traders, claiming they lost the firm $10,000, $16,000, or whatever. Great stuff.
  • #19,890
  • Sep 2, 2023 6:34am Sep 2, 2023 6:34am
Quoting Capablanca
{quote} Two points: 1. You ask how long they are able to survive if they don't trade live, just using fees. I think they may survive forever because I believe (not 100% sure) that collected fees upfront are enough to cover the total payouts. Just like a casino. 2. Regarding broker, we know that 8crap has ready to use packages for firms. It is more costly to setup their own server. So, we can see this from a different angle: the scammers will use a "ready to use" solution like 8crap, while the ones trying to be for the long term prefer to invest...

this time had to disagree,

its wont run for ever, no ponzi ever.

and shutting down has two faces. 1 run out with fund. 2. shut down bcz of loss.

cant remember the name saw one firm which offers live ACC with the fee similar to challenge ACC (according to industry avg) after sawing that I knew that they cant sustain, and after 3/4 months they closed.

and if u want to make any business u have to accept loss and profit both. but here in mff case no loss for them. only profit section.

as I mentioned before. slide tricks on trading environment is acceptable, bcz this is loop of he law and broker r using it.

i don't like those prop which suspend ACC or declining profits for changing ips, passwords etc these r scamming, but if a firm pays properly and have some slippage or slidely big spreads its fine.
  • #19,891
  • Sep 2, 2023 6:36am Sep 2, 2023 6:36am
Quoting MuniFX
{quote} In gambling you can only win what's on the "table" If all participants win the pot is split In a Ponzi scheme you are promised and able to win more than what's on the "table" because the missing sum is paid by "another table" If all MFF participants would have been successful MFF couldn't pay the promised 125% fee refund +profits ... So MFF is Ponzi not gambling business
Not really. This is like roulette. There is no chance that all bettors are successful , unless they bet all in the same number and are all successful, spin after spin.

I think that statistically they know that overall fees will be enough to pay the successful ones.
  • #19,892
  • Sep 2, 2023 6:44am Sep 2, 2023 6:44am
Quoting kalastaja
{quote} You are free to disagree. There have always been succesful prop companies. This Ponzi industry most people call prop industry is just a Ponzi scheme mostly. There is a few good companies but they have a strict rules, healthy profit sharing and realistic evaluation program. One thing to keep in mind is that you dont need to trade in real markets at evaluation phase. Only when traders are granted permission to trade and have a share of profits.
OK, I reread your post and admit I may have misinterpreted you.

Yes, there are plenty of real profitable prop firms out there. What I wanted to ay is that if there is obligation to exist real money and real trades, as you said, no prop industry will exist in the same loose and easy way that we see now. The easiness of purchasing a challenges and get immediate credentials, multiple challenges, one after another, being able to bust a dozen funded accounts, passing challenges in a couple of hours, not having to show any previous experience, etc.
None of this will exist if the regulators demand real money and real trades.
  • #19,893
  • Sep 2, 2023 6:47am Sep 2, 2023 6:47am
Quoting Capablanca
{quote} Not really. This is like roulette. There is no chance that all bettors are successful , unless they bet all in the same number and are all successful, spin after spin. I think that statistically they know that overall fees will be enough to pay the successful ones.
That would be the case if it would not be so easy to pass and profit sharing would be realistic. In real world world and real capital markets, no one is willing to give you money to trade and only take 15-20% of profits. And yes, I know that these Ponzi companies dont trade real and that is exactly the problem.
  • #19,894
  • Sep 2, 2023 6:48am Sep 2, 2023 6:48am
Quoting inversio
{quote} this time had to disagree, its wont run for ever, no ponzi ever. and shutting down has two faces. 1 run out with fund. 2. shut down bcz of loss. cant remember the name saw one firm which offers live ACC with the fee similar to challenge ACC (according to industry avg) after sawing that I knew that they cant sustain, and after 3/4 months they closed. and if u want to make any business u have to accept loss and profit both. but here in mff case no loss for them. only profit section. as I mentioned before. slide tricks on trading environment...
I should have said that they can run forever if well managed.

From the moment that you have 100K challenge fees and 80K lifetime payouts from those customers, you can go on on business forever just like a casino does.
You just have to manage risk (which MFF did banning the arb guys or putting the most successful traders in real market), just like casino does (they try to ban card counters, people with electronic devices, etc.)
  • #19,895
  • Sep 2, 2023 6:51am Sep 2, 2023 6:51am
Quoting Capablanca
{quote} I got a payout+refund from FXIFY in a second account I got yesterday (fortunately they have the 24 hours first payout rule so I'm safe now).
i am waiting to get my payout next week.

Yea, the 1 day rule is good one. We get back our money.
Intraday only.
  • #19,896
  • Sep 2, 2023 6:53am Sep 2, 2023 6:53am
Quoting kalastaja
{quote} That would be the case if it would not be so easy to pass and profit sharing would be realistic. In real world world and real capital markets, no one is willing to give you money to trade and only take 15-20% of profits. And yes, I know that these Ponzi companies dont trade real and that is exactly the problem.
To be a ponzi would mean that the revenue from 100 challenge was not able to pay the lifetime payouts from the 3 or 4 people that passed those 100 challenges.

Until we see real stats we can't say this is a ponzi or it's not a ponzi. I think it's not a ponzi, the same way a roulette it's not a ponzi (in roullete the losing customers pay the winning ones and still remains 2.7% for the casino).

In other words, it's not the existence (or not) of real trades that define a ponzi in this case.
  • #19,897
  • Sep 2, 2023 7:12am Sep 2, 2023 7:12am
Dark Clouds Gathering !
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Mastermind............
Master your Mind then Master your Trades
  • #19,898
  • Edited 7:28am Sep 2, 2023 7:12am | Edited 7:28am
hmmmmm... could the current model still work with some small tweaks in the US...

1. Forex + Futures instead of banned CFDs
2. no more lying about being funded, live trading, real markets ect.
3. no fake commissions charged
4. no backend tricks with excessive slippage
5. no drawdown limits, instead of 100K with 10% DD, it's just full 10K account
6. Tax payer reporting to IRS
7. Prop financial reporting to CFTC
8. 3rd phase stated as payed simulated environment where traders get profit split
9. Front page of website monthly disclosure of pass & payout %
10. Graduate from payed simulated after 5 payouts to live futures account w/ regulated broker where the CFTC/NFA can get their money

This would promote Futures trading and create more future paying customers for the CFTC/NFA + all the exchanges under their purview

What you guys think?
  • #19,899
  • Sep 2, 2023 7:23am Sep 2, 2023 7:23am
Quoting CableJ
hmmmmm... could the current model still work with some small tweaks in the US... 1. Forex + Futures instead of banned CFDs 2. no more lying about being funded, live trading, real markets ect. 3. no fake commissions charged 4. no backend tricks with excessive slippage 5. no drawdown limits, instead of 100K with 10% DD, it's just full 10K account 6. Tax payer reporting to IRS 7. Prop financial reporting to CFTC 8. 3rd phase stated as payed simulated environment where traders get profit split 9. Front page of website monthly disclosure of pass & payout...
Very good. Any prop firm already doing this ?
  • #19,900
  • Sep 2, 2023 7:28am Sep 2, 2023 7:28am
Quoting CableJ
hmmmmm... could the current model still work with some small tweaks in the US... 1. Forex + Futures instead of banned CFDs 2. no more lying about being funded, live trading, real markets ect. 3. no fake commissions charged 4. no backend tricks with excessive slippage 5. no drawdown limits, instead of 100K with 10% DD, it's just full 10K account 6. Tax payer reporting to IRS 7. Prop financial reporting to CFTC 8. 3rd phase stated as payed simulated environment where traders get profit split 9. Front page of website monthly disclosure of pass & payout...
Probably not financially feasible over the long run.

Mastermind ..........
Master your Mind then Master your Trades
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