> For the complete documentation index, see [llms.txt](https://eosi-finance-1.gitbook.io/eosi-finance-documentations/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://eosi-finance-1.gitbook.io/eosi-finance-documentations/eosi-finance/6.-copy-trading-and-trader-onboarding/6.1-evaluation-process.md).

# 🧪 6.1 Evaluation Process

<mark style="color:$primary;">**EOSI Finance**</mark> introduces a transparent, multi‑stage evaluation for pro traders. We use a tiered evaluation system inspired by industry best practices but enhanced with AI:

1. **Registration & KYC:** prospective traders connect a web3 wallet and optionally undergo KYC for regulatory compliance. This is carried out by one of the leading web3 KYC platform on-chain. They purchase an evaluation package in <mark style="color:$success;">EOSIF</mark>.
2. **Simulated Account:** traders first trade on a simulated account with real market data. They use a testnet <mark style="color:$primary;">**EOSIF**</mark> token or any other testnet token approved for it. The smart contract together with the AI monitors and enforces metrics such as maximum drawdown, daily loss limits, average trade duration and risk‑adjusted return. The evaluation is dynamic; AI may adjust profit targets based on volatility and market conditions. Traders must trade for a minimum number of days, demonstrating consistency.
3. **Community Review:** if the trader meets the criteria, they may progress to a **live account** with a larger allocation. Anonymised evaluation results are published on‑chain. <mark style="color:$success;">**EOSIF**</mark> holders can vote to approve or deny progression to live funding. Crucially, governance—not <mark style="color:$primary;">**EOSI Finance**</mark>—makes the final decision on whether a trader passes. This introduces community accountability and fairness.
4. **Live Funded Account:** once the community approves a trader, the trader receives funding from the community pool. Drawdown limits, position sizing and profit targets are encoded in smart contracts. Traders who consistently exceed profit targets and abide by risk limits may unlock larger account sizes and higher profit splits; those who breach rules may have their accounts paused or terminated via community vote.
5. **Ongoing Monitoring:** AI continues to monitor live accounts, comparing trader behaviour against historical performance, market conditions and risk metrics. Unusual patterns trigger alerts and potential interventions.

This structure **is not an invitation to invest**; it is a way for the community to determine who may use the pooled capital.&#x20;

In short, traders seeking funding must complete a multi‑stage evaluation. Stage 1 involves registering with a wallet, paying an evaluation fee in EOSIF and completing an on‑chain simulation demonstrating risk management and profitability. Stage 2, the **challenge**, requires the trader to trade live markets using a small allocation with strict drawdown and position size limits. Passing both stages awards the trader a **Reputation NFT** and access to a larger, live funded account.

Contributors should understand that funds might be allocated to evaluation traders at stage 2 which remains locked until the trader completes the evaluation. Failed traders may incur losses within the permitted drawdown; such losses are borne by the pool.


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