Sebi Allows Jane Street To Resume Trading In India's Stock Market, But Not In Options

The Securities and Exchange Board of India (Sebi) has reportedly allowed Jane Street to resume trading in Indian securities, sources told Reuters on July 21. This development comes after the United States-based high-frequency trading firm deposited Rs 4,843.57 crore in an escrow account, with a lien marked in favour of Sebi.

According to the report, Sebi informed the firm via email on July 18 that, following the deposit, the restrictions imposed under its interim order are no longer in effect.

Although Jane Street has been cleared to trade again, it has given Sebi an assurance that it will not trade in options. The firm also clarified that it will not trade in the cash market until it has explained its trading strategies to Sebi, sources told Reuters.

What Is The Jane Street Case

In an interim order issued on July 3, Sebi accused Jane Street of manipulating indices, primarily Nifty Bank, by simultaneously taking positions in the cash, futures, and options markets to make significant gains. As a result, the regulator had banned the trading firm and its related entities from accessing India's securities market.

According to the interim order, Jane Street earned a total profit of Rs 36,502 crore from trades between January 2023 and March 2025. Of this, over Rs 43,000 crore came solely from index options. This amount is greater than the net profit because the group also incurred some losses in stock futures, index futures, and the cash segment.

Sebi's investigation had revealed that Bank Nifty options alone contributed Rs 17,319 crore to the group's profits from index options, which accounts for nearly 40 per cent of its total earnings from this segment.

The regulator also noted that Jane Street's trading activity was mainly focused on the weekly and monthly expiry days, when trading volumes and positions in index options typically tend to spike. On these days, the closing value of the index directly affects the payouts on options, which, according to Sebi, gave the firm both the motive and the opportunity to potentially influence the market to its advantage.

However, Jane Street has disputed Sebi's allegations.

Sebi's Confirmation On Jane Street's Escrow Deposit

In a press release on July 14, Sebi confirmed that Jane Street had deposited Rs 4,843.57 crore into an escrow account and requested the regulator to lift certain restrictions imposed under the interim order.

Sebi, then, stated that it was reviewing the request in accordance with the directions of its interim order.