SEBI Lifts Ban on Jane Street, Mandates Ongoing Surveillance

Jane Street Enters Indian Markets Under SEBI Restrictions Overview Jane Street Capital, a New York–based proprietary trading firm, has been permitted by the Securities and Exchange Board of India (SEBI) to resume trading in Indian markets after an interim ban on July 3, 2025. The lift follows Jane Street’s compliance with SEBI’s directive to deposit alleged unlawful gains into escrow. SEBI’s Interim Order & Escrow Deposit SEBI accused Jane Street of manipulating Nifty and Bank Nifty futures through a sophisticated arbitrage scheme, ordering a cessation of all trading and the freezing of assets. To comply, Jane Street deposited ₹4,843.57 crore into an escrow account with a lien favoring SEBI, without prejudice to its legal rights. Conditions for Resumption Deposit compliance triggered the lifting of market-access restrictions related to: Freezing of securities and bank accounts Limits on asset transfers and margin usage Curbs on placing orders in cash and derivatives segments SEBI’s order mandates Jane Street to: Refrain from any manipulative or unfair trading practices Adhere strictly to market conduct norms outlined in the interim order clauses Remaining Restrictions & Monitoring Although allowed back into the derivatives market, Jane Street must: Stay away from trading in options and cash markets until further discussions with SEBI are concluded Submit to continuous surveillance by the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) on all positions and transactions2 Await the outcome of ongoing legal proceedings before full restoration of trading rights Market Impact & Outlook Jane Street’s temporary exit had led to a 21 percent decline in NSE equity derivatives turnover on the first weekly expiry post-ban. Its conditional re-entry is expected to stabilize liquidity but under heightened regulatory oversight. Observers note that this episode may prompt SEBI to tighten guidelines on high-frequency and algorithmic trading in India.