Overview
CarrotFunding is the first DeFi-native trader funding firm, built to eliminate the trust, transparency, and counterparty risks that plague traditional proprietary trading firms. We combine the familiar structure of a performance-based evaluation process with the transparency of on-chain infrastructure, perpetual futures liquidity from decentralized protocols, and an NFT-based reputation layer.
Our model serves both new and experienced traders through a Challenge process. Each challenge is minted as an NFT, storing its performance directly on-chain.
This rulebook governs all CarrotFunding challenge accounts and Funded accounts. By purchasing an Challenge, you agree to these rules in full.
How It Works
Get Funded.
STEP 01
Buy Challenge
Choose challenge that fits your style and mint an access NFT.
STEP 02
Hit Objectives
Reach the profit target while respecting drawdown and risk rules.
STEP 03
Get Funded
Trade with no profit target.
STEP 04
Get Paid
Request on-demand payouts.
1 - Phase Challenge
Reach the 8% profit target while staying within both equity limits (Maximum Daily Loss and Maximum Loss). There is no time limit and no minimum number of trading days. You can pass in two trades if you manage risk properly.
2 - Phase Challenge
Reach the Phase 1 (Evaluation) profit target (5%) to advance to Phase 2 (Verification). Then reach the Phase 2 profit target (8%) to pass and receive your funded account. The same equity limits apply throughout both phases. There is no time limit on either phase.
Challenges & Fees
CarrotFunding operates on the industry-standard two-phase and one-phase challenge model across five account sizes.
2-Phase Challenge
1-Phase Challenge
All challenge fees are non-refundable once the account is activated, regardless of outcome. Each challenge is minted as an on-chain NFT recording the trader's performance.
Definitions
Equity Limits
Every CarrotFunding challenge has two equity limits active at all times, in the Evaluation, Verification and funded stages. Equity limits applies to both realized and unrealized losses. If, at any point during a trading day, losses exceed the defined threshold, the account will be considered breached and the evaluation will be terminated.
01 Maximum Daily Loss Limit
It defines the maximum amount of loss you are allowed to incur within a single trading day. Calculated as a percentage of the account equity every day at 00:00:00 UTC.
MAXIMUM DAILY LOSS = EQUITY (00:00:00 UTC) - MAXIMUM DAILY LOSS (%)
02 Maximum Loss Limit
The Maximum Loss defines the maximum total loss allowed from the High-Water Mark Balance (set as % of Starting Balance) over the entire duration of the challenge phase.
MAXIMUM LOSS LIMIT = BALANCE (HIGH-WATER-MARK) - MAXIMUM LOSS (10% OF STARTING BALANCE)
Equity Limit is a level of equity at which a breach is automatically triggered on challenge account. Your challenge has two equity limits enforced at all times, Maximum Daily Loss Limit and Maximum Loss Limit which are defined by Maximum Daily Loss and Maximum Loss, respectively.
Maximum Daily Loss
The Maximum Daily Loss is one of the core risk management rules and trading objectives of each challenge (set as %). It defines the maximum amount of loss you are allowed to incur within a single trading day. The Maximum Daily Loss resets daily.
- Max Daily Loss for 2-Phase Challenge is 5% of equity
- Max Daily Loss for 1-Phase Challenge is 4% of equity
At Challenge Start
Set as a percentage of your starting equity.
MAX DAILY LOSS = STARTING EQUITY × MAX DAILY LOSS
Daily Reset
Recalculated at 00:00:00 UTC based on your current account equity
MAX DAILY LOSS = EQUITY (00:00:00 UTC) × MAX DAILY LOSS
Maximum Daily Loss Example
Equity (00:00:00 UTC)
$52,000
Max Daily Loss ($)
$2,600
Max Daily Loss Limit
$49,400
Example 01
You have a $100,000 2-Phase Challenge. The Maximum Daily Loss is set at 5% of the account equity (at 00:00:00 UTC), which equals 5,000 USDC and your Maximum Daily Loss Limit is 95.000 USDC.
If you close trades during the day with a realized loss of 3,000 USDC, you may only incur an additional 2,000 USDC in unrealized losses that same day. If, at any point, your total daily loss (realized + unrealized) exceeds 5,000 USDC, the account is breached - even if the loss is only temporary and later recovers.
Likewise, if you make a profit of 4,000 USDC during a single trading day, your maximum allowable drawdown from that high is 9,000 USDC (account equity must not fall below 95,000 USDC). The Maximum Daily Loss is recalculated from the starting equity of the trading day, excluding the intraday peak.
maximum daily loss limit
Limit resets every day at 00:00:00 UTC based off equity.
Maximum Loss
The Maximum Loss defines the maximum total loss allowed from the High-Water Mark Balance (set as % of Starting Balance) over the entire duration of the challenge phase, meaning it is not static. The Maximum Loss is updated whenever highest balance is reached (throughout the trading day) and it stops trailing your balance once Maximum Loss Limit is above the account’s initial starting balance.
- Max Loss for 2-Phase Challenge is 10% of starting balance
- Max Loss for 1-Phase Challenge is 8% of starting balance
At Challenge Start
Set as a percentage of your starting balance.
MAXIMUM LOSS = STARTING BALANCE × MAX DAILY LOSS
Maximum Loss Example
Highest Balance (HWM)
$106,000
Example 01
You have a $100,000 2-Phase Challenge with a High-Water Mark of 106,000 USDC, the Maximum Loss for the account would be 10,000 USDC (10% of the starting balance), with the Maximum Loss Limit set at 96,000 USDC (106,000 USDC − 10% of the starting balance). Once the Maximum Loss Limit exceeds the initial starting balance, it stops trailing High-Water Mark.
If the account’s balance falls from 106,000 USDC to 101,000 USDC, the Maximum Loss Limit does not trail back down as it is based on the High Water Mark.
maximum loss limit
Limit trails the HWM upward but stops at starting balance.
Limit Breaches
A limit breach occurs when your account equity touches or falls below either of the two equity limits: Maximum Daily Loss Limit or Maximum Loss Limit. When this happens, your challenge is terminated.
Process
Access revoked. You lose trading access to the challenge immediately.
Positions closed. All open positions and pending orders are automatically closed and cancelled.
No payout eligibility. Funded challenges that breach are ineligible for any payout.
NFT status updated. Your challenge NFT reflects the breach status on next refresh.
Breaches
All breaches are final. No appeals, no resets, no exceptions.
Automatic triggers. You do not need to close a trade for a breach to occur. If your floating P&L causes equity to touch an equity limit, the breach is triggered automatically.
Limited liability. Your only loss is the challenge fee. You cannot and will not incur any additional costs or losses.
Start fresh anytime. To try again, purchase a new Challenge at any time.
Best Day Rule (1-Phase)
Applies to 1-Phase Challenge only. Not applicable to 2-Phase Challenge.
No single trading day should represent more than 50% of the total profit. Your Best Day Score must be 50 or higher to progress to a Funded account or request a payout.
You do not fail the Challenge if your Best Day Score is below 50. You simply continue trading until your best trading day represents less than 50% of your total profits. There is no time pressure, keep trading until the ratio improves.
Best day score calculation
A score of 50 or higher means your best day represents less than 50% of your total profits, and you can proceed.Your Best Day Score is calculated as:
Best Day Score = (Total Profits - Best Day Profit) / Total Profits × 100
Example 01
Total profits: $1,000
Best day profit: $600
Best Day Score: 40 ❌ (continue trading)
(1000 - 600) / 1000 × 100 = 40
Example 02
Total profits: $1,500
Best day profit: $600
Best Day Score: 60 ✅ (eligible to progress)
(1500 - 600) / 1500 × 100 = 60
Profit Target
The Profit Target is a key trading objective in each phase of the challenge. It defines the amount of net profit that must be generated from closed positions in order to complete the phase successfully.
- The required Profit Target is set as a percentage of the initial account balance (Account Size).
- All open positions must be closed before the Profit Target is considered met and the trader can progress to the next phase.
- You may take as much time as needed to reach this objective, as there is no restriction on the Trading Period.
- Once your balance reaches or exceeds the target, phase is automatically passed.
2-Phase Challenge
1-Phase Challenge
Payouts & Profit Split
You’ll be able to request a payout from your Trader Dashboard once eligible. You keep 80% of all profits generated on your funded account CarrotFunding retains 20%.
Frequency
On-demand
At any time, once eligible
Minimum PAYOUT
100 USDC
Per payout request
PAYOUT Processing
< 24 h
The payouts are processed within 24 hours
Network
USDC · Arbitrum
All payouts in USDC on-chain via Arbitrum
Profit Split
80% Trader
20% CarrotFunding
Worked Example · $10,000 account
How to Request
Close everything
All trades and pending orders must be fully closed.
Submit in dashboard
Full amount only - no partial payouts.
Receive in 24h
Paid in USDC to your verified wallet.
While a payout is being processed, trading on the account is automatically disabled. Once the payout is completed, trading access will be restored and all risk objectives (Maximum Loss and Maximum Daily Loss) will be reset to their original limits. You may resume trading immediately.
Please ensure your wallet details are correct before submitting your payout request. We are not responsible for any losses resulting from incorrect or invalid wallet addresses provided by the user, and we are unable to assist or recover funds if an error occurs.
Trading Freedom
At CarrotFunding we believe in trading freedom
The only rules that matter are your equity limits: daily loss and maximum drawdown. Everything else?
Completely up to you. No time restrictions, no trading style limitations, no artificial barriers. Trade how you want, when you want.
Available Markets
Our trading environment integrates with Gains Network, a decentralized, synthetic leveraged trading protocol. gTrade uses median spot pricing via Chainlink oracles to prevent price manipulation (no scam wicks) and supports zero price impact trading for BTC and ETH.
The exact list of available pairs and instruments is determined by Gains Network listed markets and may change as new markets are added or removed. A current list is always available on the CarrotFunding*s Trading Terminal.
Leverage
Leverage is fully customizable on a per-position basis. Trader can select any leverage amount up to the asset's maximum limit, using full leverage is never required.
2-Phase Challenge
- Select any leverage up to the asset's maximum limit for each position.
- Maximum leverage is optional, not required.
- Normal Mode: Leverage up to 5x on all trading pairs.
- Aggressive Mode: Leverage up to 200x.
2-Phase Challenge Leverage Quick Card
1-Phase Challenge Leverage Quick Card
Funded Account
Upon passing the Challenge, you receive a funded account with the same starting balance. The core risk management rules remain in place, but profit targets are removed and payouts become available.
Open Interest Limits
Open interest limits on funded stage are calculated based on the CarrotFunding vault exposure per pair and per group of correlated pairs, factoring in liquidity depth and volatility.
Funded Account Limits
A trader may hold multiple active funded accounts, up to an aggregate balance of $200,000. You can hold multiple funded accounts up to an aggregate balance of $200,000. For example: 2x $100k, or 3x $50k + 2x $25k, or any combination totaling $200k.
There is no limit to how many challenge accounts you can hold or pass. You can purchase and trade as many evaluations as you want simultaneously.
If you pass challenges that would exceed the $200,000 funded limit, those passed challenges remain in your dashboard in a "Ready to Fund" state. When your funded balance drops below $200,000 (breaches), the next passed challenge in your queue automatically converts to a funded account - no action required.
Trading & Challenge Fees
01 CHALLENGE FEE
One-time, non-refundable fee paid when purchasing a challenge & minting access NFT. There are no hidden costs, just pay the challenge fee and start trading.
02 TRADING FEES
You pay standard gTrade maker/taker fees on all positions we don't add any markup. These fees are taken directly from your account and included in your P&L, meaning they count toward your daily loss and maximum loss limits.
03 FUNDING RATES
Open positions accrue funding rates at regular intervals, standard for perpetual futures trading. Your account is automatically debited or credited based on your position direction, and these adjustments factor into your equity limits.
fee transparency
Zero monthly fees. Zero inactivity charges. Zero data costs. Zero platform fees. Zero withdrawal fees. Your only expenses are the one-time evaluation fee and the standard trading costs you'd pay on any exchange.
Every trading fee is displayed upfront on the terminal before and during position entry. No hidden costs, no surprises - complete transparency on every trade.
On-Chain Transparency
CarrotFunding operates with full on-chain transparency across execution, capital reserves, evaluation logic, and trader performance. Unlike traditional prop firms that ask you to trust their operations, we've built infrastructure where everything can be independently verified.
Every A-Booked Trade
Entries, exits, stop-losses, take-profits, and liquidations are recorded on Arbitrum's blockchain and can be independently verified via gTrade and Arbiscan.
Payouts
Every payout is publicly verifiable on Arbitrum.
Capital Reserves
50% of evaluation revenue flows into our vault via smart contracts. Real-time NAV, reserves, and hedging activity are visible.
Evaluation Logic
All challenge calculations are independently verified by Oasis Network's ROFL framework and cryptographically proven on-chain.
Trading Performance
Your Carrot FBI NFT stores your trading record on-chain: account size, leverage mode, profit milestones, and evaluation progress.
Platform Metrics
We publish aggregate transparency data: total evaluations sold, pass rates, total payouts issued, vault reserves & NAV, platform P&L, and A-book vs B-book ratios.
ACCESS OUR ANALYTICS PAGE
Real-time platform transparency. Track all payouts, active funded traders, aggregate trader profits, vault reserves, and total capital deployed all verifiable on-chain. No marketing fluff, no hidden metrics. Just raw data you can verify yourself.
Proof of Reserves (POR)
01 Transparent Capital Allocation
Smart contracts automatically direct 50% of evaluation revenue into the vault. This capital backs trader activity and payout obligations. The allocation is verifiable on-chain. No need to trust , when you can verify our payout ability
02 Real-Time Hedging Activity
A-booked trader positions are heghed into live markets through gTrade.
03 Risk-Managed Execution
The execution logic operates within scoped permissions enforced by smart contracts.
04 Scoped Permissions
Specific wallet addresses are delegated roles for automated risk management, verify who can execute which operations.
Proof of Skill (POS)
Each NFT is minted immeditely upon Challenge purchase and serves as both a piece of digital art and a progress badge, reflecting a trader’s performance and reputation within the CarrotFunding ecosystem.
What's Recorded On-Chain
- Account size and current phase.
- Profit milestones and evaluation progress.
- Leverage mode.
Your Carrot FBI NFT serves as a permanent, portable record of your trading performance. Your performance isn't trapped in a prop firm's internal database, it's yours, recorded permanently on-chain, and portable to wherever your trading career takes you.
NFT - PROOF OF SKILL
NFT STRUCTURE
Challenge Properties (Dynamic Metadata) is linked to actual trader data, updated on-chain.
Visual Rarity Properties (Static Traits) are assigned at mint with rarity weighting.
Verification layer
CarrotFunding operates on one principle: traders shouldn't have to trust their prop firm, they should be able to verify everything.
WHAT IS ROFL
ROFL (Runtime Offchain Logic) is Oasis Network's verifiable compute framework. It allows computations to run off-chain while producing cryptographic proofs that anyone can verify on-chain. This means Every evaluation calculation from daily loss tracking, maximum drawdown monitoring, profit target verification topayout eligibility is independently verified and proven cryptographically.
No more "trust us" Just verifiable math.
Hybrid Model Execution
When a funded trader submits an order, CarrotFunding routes it through one of two channels at the Firm's sole discretion. The trader's P&L outcome is identical either way, only the settlement path differs. The Firm selects the execution method on a trade-by-trade basis.
Funded traders have no control over which method is chosen.
A-Book · ON-CHAIN Execution
01
Order submitted
Trader places order on Carrot terminal
02
Routed to gTrade via Vault
Forwarded to on-chain venue
03
Executed on-chain
Filled against live order book
04
Verifiable on explorer
Settlement on-chain
B-Book · Off-chain EXECUTION
01
Order submitted
Trader places order on Carrot terminal
02
Recorded internally
Booked against the firm's risk pool
03
Hypothetical fill
Booked against the firm's risk pool
04
Identical P&L
Trader outcome unchanged
OUTCOME for trader = IDENTICAL
Same P&L for the trader, regardless of route
Every trader is labeled A-booked or B-booked on your dashboard.
Forbidden Trading Practices
All participants must follow these rules during the Challenge Process and any funded stage. Simulated trading is used to assess real trading skill, discipline, and risk management while maintaining a fair and transparent environment. These rules are designed to promote trading habits suitable for real markets with real capital, while also protecting the platform from manipulative or abusive behavior.
Forbidden Trading Practices
Exploiting technical issues
Taking advantage of platform bugs, system delays, price feed errors, execution glitches, or display inaccuracies whether intentional or not.
Unfair automation or tooling
Using automated software, high-frequency trading systems, AI-driven tools, or mass order entry systems that provide an unfair advantage or are inconsistent with normal trading behavior.
Abusive or unrealistic trading behavior
Trading in a way that does not reflect realistic market participation, including: Extreme overleveraging, one-sided exposure without risk controls and account flipping or gambling-style behavior.
Risk Management
Trading behavior must remain reasonable and consistent throughout the evaluation and funded stages. You must trade in line with normal market behavior and apply prudent risk management at all times.
hedging across accounts
Opening opposing positions on the same instrument across two or more Challenge accounts to guarantee that one account passes while the other breaches.
Manipulative or coordinated trading
Any form of collusion, coordinated trading, or manipulation, including: Using multiple or related accounts, sharing strategies to game evaluation rules and attempting to distort performance metrics or bypass objectives
Account
PERSONAL USE
Accounts are for personal use only. You may not trade on behalf of others, provide account management services, or allow third-party access. Any violation will result in immediate account termination and forfeiture of payouts.
COMPLIANCE
Compliance with all trading rules is mandatory and remains your responsibility when using CarrotFunding’s services. Any breach of these rules may result in corrective action, including trade removal, restricted platform access, Evaluation failure, forfeiture of rewards, or termination of your account. CarrotFunding evaluates risk behavior using available data and records, acting reasonably and in good faith.
Challenge Cheatsheet
A limit breach occurs when your account equity touches or falls below either of the two equity limits: Maximum Daily Loss Limit or Maximum Loss Limit. When this happens, your challenge is terminated.
2-Phase Challenge (Normal Leverage Mode)
2-Phase Challenge (Aggressive Leverage Mode)
1-Phase Challenge (Single Mode)
Read Me - Support Guide
Before contacting support, we strongly recommend the following:
01
Search the FAQ section on our website. Many common questions around evaluations, objectives, payouts, and accounts are already covered.
02
Read the Rulebook to better understand the concepts you have questions about. Our docs explain how CarrotFunding works, from challenge objectives to payouts and platform mechanics.
03
If you still can't find an answer, you can open a ticket via Discord.
Security Reminders
Never share your wallet's private key, seed phrase, passwords, or recovery codes with anyone. CarrotFunding or anyone connected to the company will never ask for sensitive wallet information.
Always double-check URLs before connecting your wallet. Scammers often use similar-looking domains.
Only interact with official CarrotFunding links shared in our documentation or official Discord channels.
This rulebook governs all CarrotFunding 2-Phase and 1-Phase Challenges and Funded accounts. CarrotFunding reserves the right to update these rules with reasonable notice. The most current version is always available at
carrotfunding.io/rulebook
