SEBI Halts Jane Street’s Operations in Indian Markets: On 3rd July 2025, SEBI imposed a temporary ban on Jane Street and its Indian subsidiary, JSI Investment Pvt Ltd, from trading in Indian markets. The order also includes depositing ₹4,840 crore of “unlawful gains” into designated accounts.
Along with this ban, four other subsidiaries from the Jane Street group are also included — JSI Investments, JSI2 Investments Pvt Ltd, Jane-Street Singapore, Jane-Street Asia Trading.
Table of Contents
How Did Jane Street Allegedly Manipulate Indian Markets?
SEBI’s detailed investigation revealed two key strategies allegedly employed by Jane Street:
1. Morning Pump, Afternoon Dump
- Aggressive purchase of Bank Nifty component stocks and futures in the morning.
- Artificial index inflation, misleading other traders.
- Afternoon liquidation of positions, causing the index to fall.
2. Expiry-Day Index Manipulation
- Large, targeted trades during expiry-day closing hours.
- Influence over index levels to distort options pricing.
- Profits made via substantial index options holdings while absorbing controlled losses in cash and futures markets.
Allegations – Expiry-day Strategy
According to SEBI’s investigation, Jane Street carried out expiry-day manipulation, where they influenced the Bank Nifty index by executing massive buy-sell orders in its constituent stocks and futures.
This created artificial market movements, and Jane Street made a net profit of ₹36,500–₹43,289 crore, out of which SEBI has termed ₹4,840 crore as unlawful gains.
Financial Strength of Jane-Street Group
Jane Street is a quantitative proprietary trading firm founded in 2000. Their global revenue surged to $20.5 billion in 2024.
According to SEBI, Jane Street earned $4.3–5 billion (₹36,500–₹44,000 crore) from India between 2023–25.
Globally, Jane Street operates in around 45 countries with nearly 3,000 employees.
What the Numbers Reveal: The Jane-Street Profit Puzzle
According to SEBI’s findings between January 2023 and May 2025:
| Market Segment | Profit/Loss (₹ Crore) |
|---|---|
| Index Options Gains | 44,358 |
| Stock Futures Losses | (7,208) |
| Index Futures Losses | (191) |
| Cash Market Losses | (288) |
| Net Profit | 36,671 |
| Illegal Profits (Disgorged) | 4,843 |
Impact on Liquidity and Derivatives Market
SEBI’s removal of Jane Street from the market is expected to reduce liquidity and increase volatility, especially on expiry-days.
Preeti Chhabra stated that the exit of a “major volume provider” will widen spreads, and with many sellers absent, decision-making could become difficult.
Zerodha’s Nithin Kamath says Jane Street is not just a participant but essentially acts as a gateway to the market, and their exit could impact retail investors as well; their estimated 50% share in options turnover could lead to temporary volatility in 35% of retail volume.
SEBI’s Perspective and Reforms
SEBI had already issued a warning to Jane Street in February 2025, but it went unheeded, forcing strict action.
SEBI stated: “expiry-day manipulation using brute capital will now face regulatory consequences” — similar practices in the future will face a “cleaner market”.
Their bank accounts and demat accounts will remain frozen until the ban is lifted.
SEBI will continue its open investigation and intends to tackle such incidents through pre-emptive surveillance going forward.
Final Thoughts
Jane-Street, a global quant trading firm, has been found by SEBI to have attempted large-scale market manipulation on India’s Bank Nifty expiry-days.
Now, SEBI has ordered a seizure of ₹4,840 crore and a temporary ban has been imposed on the Jane Street group. While the ban may lead to temporary liquidity issues and market fluctuations, SEBI expects this to enhance long-term market integrity.
Jane Street can present its defense and pursue legal action, but this decision marks a major regulatory stance in controlling India’s F&O markets.
