Prop Trading Industry Faces Transparency Crisis as Blockchain Solutions Emerge
The $20 billion prop trading industry faces scrutiny over deceptive practices, with many firms using **B-book models** that simulate trades rather than executing them in real markets.
**Key Issues with Traditional Prop Firms:**
- Trades never reach actual markets
- Profits come from trader evaluation fees, not market performance
- Frequent account bans and payout delays
- Poor customer support and lack of CEO transparency
**A-book vs B-book Models:**
- **A-book**: Real market execution, firm shares trader's risk
- **B-book**: Simulated trading, firm profits from trader losses
Blockchain-based solutions are emerging to address these problems by offering:
- Real capital trading with market exposure
- Instant on-chain withdrawals in USDC
- Complete transparency without KYC requirements
- Direct orderbook execution
The industry shift toward **on-chain transparency** aims to eliminate the smoke and mirrors approach that has plagued traditional prop firms, ensuring traders receive legitimate profit payouts.