On July 1, 2025, a common approach of SEBI (Securities and Exchange Board of India) building is seen in the trade district of Mumbai, India.
Nurphoto | Nurphoto | Getty images
The Securities Exchange Board of India (SEBI) has temporarily stopped the Gen Street Group from reaching India’s Securities Market, when it accused the American firm of widespread market manipulation.
As Interim order posted on regulator’s website on ThursdayJane Street’s “institutions are barred from reaching the securities market and directly or indirectly banned from buying, selling or dealing with securities.”
SEBI also issued an interim order to freeze more than 48.4 billion Indian rupees ($ 566.3 million) from Gen Street for alleged illegal benefits. It is further stated that banks have been directed to ensure that “no debit is made for accounts jointly or individually organized by Jane Street’s institutions, without SEBI’s permission,” no debit is made.
Jane Street disputed the findings of SEBI’s interim order and said it would engage with the regulator in response to questions from CNBC. A spokesperson of Jane Street said the firm is “committed to work in compliance with all rules in areas working around the world.”
‘Without any admirable economic logic’
Jane Street allegedly used various strategies to artificially influence India’s benchmark Nifty 50 Index – which tracks the top 50 companies in the country – and benefits from quite large positions in index options.
According to SEBI’s interim order from the 105-foot order, Jane Street aggressively buys large amounts of stocks and futures that are part of the banknifty index, which tracks India’s banking sector performance, which is early at the business day. The quantitative trading firm will then make big bets that the index will decline later during the day.
Jane Street would then sell the positions that were purchased earlier, drawing the index less and making their earlier bets more profitable in the option market.
While Jane Street would suffer some losses, SEBI said that it was part of “a intentional strategy to manipulate the indices for the benefit of trade and positions”, and the disadvantage was offered by the firm’s very large and profitable option trading.
Although these actions were not a violation of any regulation, SEBI stated that the “intensity and sheer scale” of their intervention, and the rapidly reverse of their trades, was “manipulation”.
Security of retail investors
SEBI said that even after the “clear advisory” to the firm was released by the National Stock Exchange of India in February 2025, the examples of repetition of manipulation trading on the Nifty 50 benchmark continued.
“Such egoistic behavior, in the clear disregard/ disregard of the clear advisor issued to him by NSE in February 2025, clearly shows that unlike the vast majority of foreign portfolio investors and other market participants, (Jane Street) Group is not a good confidence actor, who may be, or worthy of being, trusted,”
SEBI said, “The integrity of the market, and the belief of millions of small investors and traders, can no longer be held hostage for such an incredible actor’s machine,” SEBI said.
Deven Chokse, founder and managing director of wealth management firm Drchoksey Finserv, said that SEBI’s crack on Jane Street sets “a good example”.
“Any player who is misusing the market needs to show discipline. The regulator is doing his work to maintain the market integrity,” he told the CNBC.
While the execution of trades can be optimized by the trader’s needs and profiles, the price search in the market should be “universal for all,” Chokse said.
Kranthi Bathini, director of the equity strategy at Wealthmills Securities, said some companies “may come to the market with creative and innovative strategies to take advantage of investors.” Therefore, SEBI needs to “protect the interests of retail investors”, he said.
As a result of this decision, any effect on the markets would be short -lived, Bathini said.
SEBI’s move comes in the form of many other global trading firms, which is increasing its appearance in India, from Citadale Securities and IMC Trading to Millennium and Opter, to ride its rapidly growing derivative markets, which does the world’s largest contract trading.
The Indian regulator had earlier expressed concern over the practices Algorithm tradeJoe SEBI said in a September 2024 report that ownership traders and foreign portfolio investors were allowed to make 610 billion Indian rupees in profit in FY 2024, while retail investors and other market participants lost the same amount during that period.
– Aparajita Saxena of CNBC contributed to this report
