Account breach
An account breach is a violation of a firm's rules that ends a challenge or funded account — most often equity crossing the daily loss limit or the maximum drawdown.
Loss-limit violations are commonly called hard breaches. They are checked automatically, at most firms on live equity, and take effect the moment the line is crossed: the challenge attempt is over, or the funded account is closed. Whether the position would have recovered afterward is irrelevant.
Some firms also define soft breaches for lesser violations — holding through restricted news, exceeding position-size caps, or using banned strategies such as third-party copying. Consequences at those firms range from removing the profits of the offending trades to warnings, with repetition escalating to closure. Where each firm draws the line varies enough that it belongs on your pre-payment reading list.
What follows a breach depends on the stage. A breached challenge means buying a new attempt or a discounted account reset; a breached funded account generally sends you back to the start of the evaluation, and refund eligibility for the original fee is normally lost with it.
In a prop-firm challenge
Commonly cited breach patterns point one way: the daily loss limit, hit during a losing streak traded at undiminished size, ends far more accounts than the maximum drawdown or any exotic rule. The recurring mistakes behind that pattern are cataloged in mistakes that blow evaluation accounts.