In fact, the only case I've found where someone other than a floor trader was declared to be a trader for tax purposes involved a compulsive gambler who lost millions in the stock market. Until a few years ago, virtually the only people who could realistically sustain the kind of activity that would qualify for trader status were people with access to the floor of a stock exchange. Floor traders have lower transaction costs and control over execution and of course, current price information is right in front of them. The Internet changes all that. Trading commissions are way down.
Spreads are smaller, too, and current price information is a mouse click away.
Just in the last couple of years it has become possible as a practical matter to engage in the kind of activity that qualifies for trader status without being on the floor of an exchange. It's still hard really hard to make money as an electronic day trader. Most people who try it lose their shirt. But it's no longer impossible. And that means for the first time we're going to see tax cases dealing with trader status for this type of trader.