FTMO 2-Step Challenge Explained: Phase 1, Phase 2, Funded (2026)

The FTMO 2-Step Challenge is FTMO's flagship evaluation: a two-phase test that takes you from a 10% profit target in Phase 1, to a 5% profit target in Phase 2 (called Verification), to a funded FTMO Account with an 80% profit split that scales to 90%. It is the path most FTMO traders still take, the one that defined the original prop-trading-eval template the rest of the industry copied, and the structural foundation of FTMO's $500M+ in cumulative payouts to traders since 2015.

Both phases share the same risk envelope: a 5% daily loss limit, a 10% static maximum loss (the floor never trails), and a minimum of 4 trading days per phase. The 2-Step is available in Standard and Swing variants, same price, same drawdown rules, across five account sizes from $10K to $200K. The challenge fee is refunded with your first payout from the funded stage, making the entry cost effectively a recoverable deposit if you reach funded and withdraw profits.

This guide walks the full mechanic end-to-end: what each phase enforces, how the funded stage differs, the Standard versus Swing decision, full pricing for all five sizes, the Scaling Plan that lifts the split from 80% to 90%, and the strategic context for choosing the 2-Step over the 1-Step Challenge. All facts reflect the FTMO ruleset as of May 2026, after the firm's December 2025 acquisition of OANDA and the resulting institutional positioning that now sits behind the brand.

For the full FTMO ruleset, account taxonomy, and broader context, see the FTMO main review and the FTMO accounts pillar. For deep-dives on related mechanics, see the scaling plan article, the Swing account guide, and account sizes overview.

What is the FTMO 2-Step Challenge?

The FTMO 2-Step Challenge is the original FTMO evaluation pathway. Two sequential phases, both run on the same simulated account, gate access to the funded FTMO Account where real profit splits begin.

Phase 1, sometimes simply called the FTMO Challenge, requires a 10% profit on the starting account balance. Phase 2, called Verification, requires a 5% profit on the same starting balance, the lower bar exists because Phase 2 is designed to confirm that Phase 1 was not a one-off result. Both phases enforce identical risk rules: a 5% daily loss limit calculated from the day's starting equity, and a 10% static max loss measured from the initial balance.

When both phases pass, the trader receives the funded FTMO Account at the size purchased. There is no extra step, no live-money funding event in the literal sense, FTMO operates a simulated-capital prop-firm model, but the account behaves as funded for all practical purposes: real profit splits, real bi-weekly payouts, no profit target, and the same drawdown framework that governed the evaluation phases.

The 2-Step has been FTMO's signature product since the firm launched in 2015 and it remains the structural template the entire industry now imitates. Paul has traded FTMO for ~4 years and withdrawn $15K+ in real payouts, scalping the 1-Step on Standard $50K and $100K sizes; the 2-Step is the path most FTMO traders historically choose.

How does Phase 1 work?

Phase 1 is the longer, more demanding leg of the 2-Step. The trader must reach a 10% profit target while respecting both the 5% daily loss limit and the 10% static max loss, with a minimum of 4 trading days. There is no fixed deadline on the 2-Step in the 2026 ruleset, so traders can move at their own pace as long as the account remains within the loss envelope.

A 10% target on a $100K account translates to $10,000 in net profit; $5,000 on a $50K. The target is calculated against the initial balance. The 4-trading-day minimum is satisfied by any day with at least one open or closed position, so you cannot pass Phase 1 in three sessions even if you hit the target faster.

The 5% daily loss limit resets at the start of each new server day (Central European time). It is calculated from the day's starting equity, so a session that opens at $103,000 on a $100K account has the day's floor set at $97,850 rather than $95,000. Profitable streaks raise the daily floor in your favor.

The 10% static max loss is the harder edge. On a $100K account the floor sits at $90,000 from day one and never moves. It is the absolute account-failure level throughout Phase 1, Phase 2, and the funded stage. This static behavior is the single biggest mechanical difference versus the 1-Step Challenge, where the 10% max loss trails upward end-of-day.

Phase 1 has no Best Day Rule. You can earn the bulk of your 10% target on a single high-conviction session and still pass, assuming session-end equity stays above the daily and static floors. The 1-Step caps any single day's profit at 50% of total accumulated profit; the 2-Step does not.

How does Phase 2 (Verification) work?

Phase 2, formally named Verification, halves the profit target to 5%. Everything else carries over from Phase 1 unchanged: 5% daily loss limit, 10% static max loss, 4 minimum trading days, no fixed time deadline as of 2026.

The lower target reflects FTMO's editorial framing: Phase 1 tests whether you can produce returns; Phase 2 tests whether you can do it again with less aggression. The 5% target is achievable with substantially smaller risk per trade, which is the behavioral pivot the firm wants confirmed.

Account size and starting balance reset back to the original purchase tier when Phase 2 begins. A $100K trader who finished Phase 1 at $112,000 in equity does not start Phase 2 with that balance; the account resets to $100,000 with a new 5% target and the same $90,000 max loss floor. Phase 1 profits do not carry forward as buffer.

Phase 2 typically takes a fraction of the time most traders allocate to Phase 1 because the target is half. Many traders pass in 2 to 4 weeks if they maintain Phase 1's risk discipline. The structural risk is the opposite of what intuition suggests: the smaller target encourages over-confidence and oversize bets, which most often costs traders the daily loss limit rather than the max loss floor.

For deeper tactics on clearing both phases, see the 2-Step pass strategy guide and the broader FTMO strategy pillar.

What changes when you reach Funded status?

The funded FTMO Account is where real money enters the picture. There is no profit target, you trade as you would your own capital. The 5% daily loss limit and 10% static max loss carry over from the challenge phases unchanged, with one tactical adjustment: the static max loss now ratchets when you withdraw profits, effectively resetting the buffer relative to the post-payout balance.

The default profit split on the 2-Step funded account is 80%. That means $1,000 in net profit pays out $800 to the trader and $200 to FTMO. The 80% base is one of the higher base splits across the industry but lower than what the 1-Step offers (90% from day one). The Scaling Plan, covered in detail below, lifts the 2-Step's 80% to 90% over time as you demonstrate sustained performance.

Payouts on the funded account are bi-weekly with average 8-hour processing. Withdrawals can use bank transfer, Skrill, and crypto rails. The first payout also triggers the challenge-fee refund.

News and weekend rules differ by account variant. Standard funded accounts must close positions through high-impact news events and over weekends. Swing funded accounts have no such restrictions. The challenge phases themselves do not enforce news restrictions; the rule activates at the funded stage only.

For the bottom-line view of the funded stage, see the funded account guide and the payout cadence article.

How is Standard different from Swing?

Standard and Swing are the two account-type variants offered on the 2-Step. They are identical in price, identical in drawdown rules, and identical in profit-split structure. The only differences are positioning permissions on the funded stage.

Standard accounts on the funded stage prohibit holding positions over weekends and through high-impact news events. The trader must close all open positions before the weekend close (typically Friday US session close) and 2 minutes before plus 2 minutes after each scheduled high-impact data release. Violations on news or weekend holds risk the funded account's status. The Standard variant suits intraday and short-swing strategies that already plan to be flat by Friday close.

Swing accounts on the funded stage have neither restriction. Trades can run through weekends, through Non-Farm Payrolls, through ECB and FOMC announcements, anywhere the strategy needs to. The Swing variant is the natural choice for traders who run multi-day or multi-week setups, breakout strategies that depend on news catalysts, or carry-style positions in commodities or crypto.

Crucially, both variants cost the same. FTMO does not charge a Swing premium on the 2-Step the way some competitors do. This is one of the underrated structural strengths of the FTMO 2-Step product: a swing trader pays the same as a scalper for the same buying power, then keeps the freedom to hold through events.

The 1-Step Challenge does not offer a Swing variant. If you want Swing rules at FTMO, the 2-Step is the only path. For the full Swing-versus-Standard comparison see the Swing account deep-dive.

What sizes and pricing are available?

The 2-Step Challenge is available across five account sizes, from $10K up to $200K. Pricing is identical for Standard and Swing variants within each tier. All fees are charged in EUR; USD-equivalent estimates use a typical 1.08 conversion rate and will fluctuate.

The $200K is the largest single-account size you can purchase upfront. Beyond that, the Scaling Plan is the only path to higher buying power on a single funded account, with documented per-account caps in the $400K range and aggregate multi-account scaling potentially reaching $2M as of 2026.

The fee buys one challenge attempt. If you breach Phase 1 or Phase 2, you pay again to retry. The fee is refunded once you pass both phases and process your first payout from the funded account, making the upfront cost economically a recoverable deposit if you reach funded and withdraw real profits.

The 2-Step pricing has been stable at these levels since at least mid-2025 and was reconfirmed in May 2026 health-check research. The 1-Step Challenge runs cheaper at €79 to €999 across the same sizes, but with tighter daily-loss rules and a trailing max loss, see the 1-Step pricing breakdown for the cross-comparison.

How do Phase 1, Phase 2, and Funded compare?

The full mechanic is easier to read in matrix form. The table below summarizes the rule envelope across all three stages of the 2-Step path.

The pattern this table makes visible is that the 2-Step front-loads the difficulty. Phase 1 is structurally the hardest leg, highest target, same loss limits as later stages. Phase 2 is a controlled-aggression test. The funded stage removes the target but keeps the same risk envelope, which is exactly the discipline curriculum the two phases are meant to teach.

What is the Scaling Plan and how does 80% become 90%?

The Scaling Plan is the FTMO mechanism that lifts the 2-Step's funded profit split from 80% to 90% and increases the funded account size by 25% per qualifying cycle. It is reviewed every 4 calendar months on the funded account.

Three trigger conditions must all be met within a 4-month review cycle:

1. Net profit of at least 10% across the cycle, measured cumulatively (not month-by-month).
2. Profitable in at least 2 of the 4 calendar months within the cycle.
3. Zero rule violations, no daily loss limit hits, no max loss breaches, no news or weekend infractions on Standard accounts.

When all three are satisfied, the next cycle begins with the account balance increased by 25% and the profit split raised to 90%. Subsequent qualifying cycles continue the 25% balance increases up to a per-account ceiling that sits around $400K based on FTMO's published documentation, with aggregate exposure across multiple accounts potentially reaching $2M.

The Scaling Plan is the structural answer to "why take the 2-Step instead of the 1-Step?" The 1-Step starts at 90% but caps there structurally, you reach the highest split immediately, and account-balance scaling is the only future lever. The 2-Step starts lower and rewards demonstrated multi-cycle consistency with both a higher split and a larger account. For traders who plan to hold the account for many cycles, the 2-Step's growth curve compounds.

For the deep mechanics, see the FTMO scaling plan article.

What is the refund mechanic?

The challenge fee paid upfront is refunded to the trader's account when the first payout from the funded FTMO Account is processed. This makes the original entry cost economically a deposit that returns once the trader reaches the funded stage and withdraws real profits.

The mechanic in practice: the trader purchases a $50K Standard 2-Step for €345. They pass Phase 1, pass Phase 2, and reach the funded account. They trade for 14 days, request their first bi-weekly payout, and receive both the profit split and the €345 refund alongside it.

If the trader fails Phase 1 or Phase 2, no refund is issued and a new attempt requires a new purchase. The refund applies equally to Standard and Swing variants and across all five account sizes. The 1-Step Challenge uses the same refund mechanic. There is no separate fee on the funded stage; the original challenge fee is the only out-of-pocket expense, and it returns on first payout.

For the full payout architecture and timing, see the FTMO payouts and refund guide.

How long does it take traders to pass on average?

FTMO does not publish official median pass times for the 2-Step. The structural minimum is 4 trading days per phase, 8 days total, but the realistic median across community-reported data sits in a much wider range.

Most public reporting and community consensus places typical Phase 1 pass time at roughly 30 to 60 days for traders running standard 0.5% to 1% per-trade risk. Phase 2 typically takes 30 to 45 days because the 5% target is half of Phase 1 with the same risk-per-trade discipline. Aggressive traders sometimes pass both in 2 to 3 weeks combined, though the same risk profile that compresses the timeline also raises the breach probability significantly.

The 2-Step has no fixed time limit in the 2026 ruleset, so the pass distribution is genuinely uncapped on the slow side. Traders can move as patiently as their strategy requires. This is one of the structural reasons consistency-first traders prefer the 2-Step path: there is no deadline incentivizing risk inflation in the back half of the challenge.

The minimum 4-trading-days requirement effectively forces a behavioral floor: even traders who hit the 10% target in a single session must trade at least 4 days before passing. This rule exists because FTMO wants to verify that the result is at least minimally reproducible, not a one-off lottery ticket.

What strategy works best on the 2-Step?

The 2-Step rewards consistency-first strategies that respect the 5% daily loss envelope and the 10% static max loss. Strategies that win consistently with smaller per-trade risk, moderate-frequency intraday systems, short-swing setups on the Standard variant, multi-day positional plays on Swing, produce the highest pass rates.

A common strategic split: run Phase 1 with calibrated risk that lets you reach 10% in 4 to 6 weeks (typically 0.75% to 1.25% per trade), then dial risk back to 0.5% to 0.75% per trade for Phase 2's 5% target. Phase 2 is shorter because the target is half, but the daily loss limit is the same, so a single bad day in Phase 2 has more relative impact.

The Standard variant is the natural fit for intraday scalp and short-swing strategies that already close before weekends. The Swing variant unlocks news-event traders and multi-day positional traders who would otherwise leave structural alpha on the table by being forced to close. The price is identical, so the choice is purely about which permissions match the strategy.

Avoid concentrating your entire 10% Phase 1 target on a single high-leverage trade. The 2-Step has no Best Day Rule like the 1-Step, but a single trade that takes you from neutral to +10% on Day 1 also implies a return path that could just as easily go the other direction and breach the 5% daily floor. The static max loss provides hard protection but offers no behavioral guardrail.

For tactical depth, see the dedicated FTMO strategy pillar and the 2-Step pass strategy article.

How does the 2-Step compare to the 1-Step?

The 2-Step and 1-Step are structurally different products that share the FTMO brand and a similar funded-stage payout architecture but differ on every meaningful evaluation dimension.

The 2-Step has two phases (10% then 5% target). The 1-Step has one phase (10% target). The 2-Step has a 5% daily loss limit; the 1-Step is tighter at 3%. The 2-Step's 10% max loss is static; the 1-Step's is trailing end-of-day, ratcheting upward as equity grows. The 2-Step starts the funded stage at 80% and scales to 90% via the Scaling Plan; the 1-Step starts at 90% from day one with no scaling required to reach the higher split. The 2-Step offers Swing; the 1-Step is Standard-only. The 1-Step has a 50% Best Day Rule; the 2-Step does not.

The decision tree most traders use:

• Choose the 2-Step if: you want Swing flexibility, you prefer a static max loss floor, you trade multi-day positions, you want to grow account size via the Scaling Plan, or you want the lowest daily-loss-limit pressure (5% beats 3%).
• Choose the 1-Step if: you scalp short-frequency intraday with very tight risk per trade, you want the 90%-from-day-one split, you can manage a trailing max loss without the equity ratcheting biting, and you don't need Swing.

Paul scalps the 1-Step Challenge primarily because the 90%-from-day-one mechanic and tighter daily floor align with high-frequency execution. For most discretionary and swing traders, the 2-Step's structural forgiveness on the daily floor and its Swing variant make it the better fit.

For a comparison against external competitors, see FTMO vs The5ers and FundingPips vs FTMO, both of which run similar 2-step models with their own structural twists. The5ers' Black Arrow product offers a futures-tested alternative; FundingPips runs a CFD-only model out of the UAE.

For the full M1 review covering both challenges plus Trust, payouts, and the OANDA acquisition context, see the FTMO main review. For the cluster-level FAQ pillar, see the FTMO mega-FAQ. For 1-Step details, see the 1-Step Challenge guide.

The bottom line

The FTMO 2-Step Challenge is the firm's flagship and most structurally forgiving evaluation product. Phase 1 (10% target), Phase 2 (5% target), and the funded stage all share the same 5% daily loss limit and 10% static max loss, no trailing, no surprise floor moves. The funded account starts at an 80% profit split and scales to 90% via the Scaling Plan after a 4-month qualifying cycle of 10% net profit, profitability in 2 of 4 months, and zero rule violations.

Five sizes from $10K to $200K, EUR pricing from €155 to €1,080, identical Standard and Swing options at the same fee, and a refund of the challenge fee on first payout. Pass times realistically run 30 to 60 days for Phase 1 and 30 to 45 for Phase 2, with no fixed deadline as of 2026.

For most discretionary and swing traders the 2-Step is the right FTMO product. The 1-Step is faster and offers 90% from day one but enforces a tighter 3% daily floor and a trailing max loss. The 2-Step's static-floor-plus-Swing-permissions package is the structural sweet spot for the majority of FTMO's customer base, and it is the path that built the firm's $500M+ in cumulative trader payouts since 2015.

FTMO's December 2025 acquisition of OANDA is the institutional backstop behind the 2-Step today. The mechanic has been stable for years; the corporate context is substantially stronger than it was 18 months ago.

Frequently Asked Questions

What is the FTMO 2-Step Challenge?

The FTMO 2-Step Challenge is the firm's classic two-phase evaluation. Phase 1 requires a 10% profit target with a 5% daily loss limit and 10% static max loss. Phase 2 (called Verification) drops the target to 5% with the same loss limits. After passing both, you receive a funded FTMO Account with an 80% profit split that scales to 90% via the Scaling Plan.

How does Phase 1 work on the FTMO 2-Step?

Phase 1 requires a 10% profit on the starting balance, for example, $10,000 on a $100K account. You must trade at least 4 days, stay above the 5% daily loss limit, and never breach the 10% static max loss floor. There is no fixed time limit on the challenge as of 2026, so you can move at your own pace.

How does Phase 2 (Verification) work?

Phase 2, called Verification, halves the profit target to 5%, so $5,000 on a $100K account. The 5% daily loss limit and 10% static max loss carry over unchanged. You also need 4 minimum trading days. The lower target reflects FTMO's intent that Phase 2 is about confirming consistency, not chasing aggressive returns.

What changes when you reach the funded FTMO Account?

On the funded account there is no profit target. You keep the same 5% daily loss limit and 10% static max loss as in the challenge. Profit split starts at 80% and can scale to 90% through the Scaling Plan. Payouts run bi-weekly with average 8-hour processing. Standard accounts have news and overnight restrictions on the live phase; Swing accounts do not.

How is the Standard variant different from Swing on the 2-Step?

The drawdown rules and pricing are identical. The Standard account restricts holding positions over weekends and through high-impact news events on the live funded stage. The Swing account allows both. Many traders pick Swing if their strategy involves event-driven setups or multi-day holds. Both are available across all five account sizes at the same fee.

What sizes and prices are available on the 2-Step?

Five sizes: $10K (€155), $25K (€250), $50K (€345), $100K (€540), $200K (€1,080). Standard and Swing variants are the same price within each tier. The 1-Step Challenge uses a different (lower) pricing structure and has no Swing variant, see the 1-Step deep dive for that.

What is the FTMO Scaling Plan and how does 80% become 90%?

The Scaling Plan reviews your funded account every 4 months. To trigger a scaling event, you need at least 10% net profit across the period, profitable months in at least 2 of the 4 calendar months, and zero rule violations. When you qualify, the account balance increases by 25% and the profit split upgrades to 90%. The mechanic is exclusive to the 2-Step path because the 1-Step starts at 90% from day one.

Is the FTMO 2-Step challenge fee refundable?

Yes. The challenge fee is refunded together with your first profit payout from the funded FTMO Account. If you fail Phase 1 or Phase 2, there is no refund, you would purchase a new attempt to retry. The refund mechanic effectively makes the challenge fee a deposit that comes back once you reach the funded stage and withdraw real profits.

How long does it take traders to pass the 2-Step on average?

FTMO has not published official median pass times, so any specific number is an estimate. The minimum is 4 trading days per phase, so theoretically 8 days total. Realistic ranges most traders report are 30 to 60 days for Phase 1 and a similar window for Phase 2, depending on strategy aggressiveness. The 2-Step has no hard time limit in 2026, so consistency-first traders can take their time.

What strategy works best on the FTMO 2-Step?

Strategies that respect the 5% daily loss limit and the 10% static max loss tend to perform best. Many traders run a moderately aggressive Phase 1 to clear the 10% target, then switch to lower-risk consistency mode for the 5% Phase 2. Swing traders gain the most edge on the Swing variant since they can hold through weekends and news. Avoid concentrated single-day risk because while the 2-Step does not enforce a Best Day Rule like the 1-Step, the static max loss still hard-caps total exposure.

How does the 2-Step compare to the 1-Step Challenge?

The 2-Step has two phases (10% then 5% target), 5% DLL, 10% static max loss, 80% base split scaling to 90%, and Standard plus Swing variants. The 1-Step is a single phase (10% target), tighter 3% DLL, 10% trailing max loss, 90% from day one, and a 50% Best Day consistency rule. The 2-Step is more forgiving on intraday risk and rewards consistency; the 1-Step is faster but punishes drawdown harder.

Does the 2-Step have a Best Day Rule like the 1-Step?

No. The 50% Best Day Rule, which caps any single day's profit at 50% of total accumulated profit, applies only to the 1-Step Challenge. The 2-Step lets you concentrate gains on individual days as long as you respect the 5% daily loss limit and the 10% static max loss. This is one of the structural reasons many discretionary traders prefer the 2-Step path.

Can I trade Standard and Swing simultaneously on the 2-Step?

Yes, they are separate account types and can run in parallel as separate challenges. Some traders open one Standard $50K and one Swing $50K to test both rule sets. Each challenge is paid for independently, and each refund is tied to its own first payout. Just remember the underlying drawdown rules are identical, so the only practical difference is the news and weekend permission set on the live funded stage.