Has the
retail prop trading market become oversaturated? Ascetic Capital’s case, which
spent more time announcing its launch than actually operating, might be
tangible proof. The firm announced it is “refunding everyone” and
ceasing operations.

On the
bright side, the refund waiting list won’t be too long, given they only managed
to sell a few challenges.

Prop Firm Ascetic Capital
Sets New Record for Shutting Down

Ascetic
Capital announced today (Tuesday) that it’s initiating refunds and halting
operations “before even a single trader gets funded to mitigate the
damage.”

According
to their social media statement, the official launch in late November “did
not meet even the most modest expectations.”

In their
first (and only) full week of operations, Ascetic Capital sold just four
challenges. The prop firm explains this triggered a breach of contract
conditions and led to investors pulling out.

“We
truly thought we had everything needed to succeed; financial backing,
competitive pricing, and simple, transparent rules,” Ascetic Capital
explains. “But despite all our efforts, the response was far from what we
had envisioned. The responsibility lies solely with us.”

However, credit
must be given to the firm for their honest and transparent approach, avoiding
any pretense that everything was fine or misleading potential clients in hopes
of a turnaround.

“We
misjudged the market and overestimated our ability to bring our vision to
life,” the prop firm admitted.

The firm
spent months teasing its launch, first appearing on social media in July. From
the start, they suggested creating an A-book firm, unlike most prop trading
companies operating on B-Book models. However, if they were truly an A-Book
firm, they wouldn’t have needed to worry about initial sales numbers.

The service
was initially scheduled to launch in October, but Ascetic Capital announced a
delay “due to unforeseen circumstances” beyond their control. The
launch finally occurred on November 28, but the firm quickly decided to exit
the market.

Growing Prop Trading
Industry Casualties

On the same
day Ascetic Capital entered the market, Finance Magnates reported the
closure of another prop trading firm, Smart Prop Trader. It joined an expanding
list of sector companies unable to survive in an increasingly competitive
market.

“Smart Prop
Trader will no longer onboard new traders,” the company commented in a social
media post. “Smart Prop Trader is committed to doing the right thing by
prioritizing fairness, transparency, and respect for our traders, and providing
extra time for traders to earn payouts.”

Industry
sources indicate at least 50 other prop firms ceased their operations this
year.

“These
shutdowns have resulted in significant financial losses for hundreds of
thousands of traders who were either locked out of accounts they had purchased
or never received payouts they had earned,” FunderPro’s Alex Zanutto explained.

Interestingly,
industry representatives remain optimistic about 2025, expecting above-average
trading conditions. However, 71% of U.S. respondents don’t rule out consolidation
and increasing dominance of major players.