Social media has become a platform for so‑called ‘finfluencers’ who promote techniques promising rapid success, often presenting options trading as a shortcut to profit.

Social media has become a platform for so‑called ‘finfluencers’ who promote techniques promising rapid success, often presenting options trading as a shortcut to profit. They attract newcomers to paid courses, claiming to teach effective trading strategies. However, deception often occurs, as influencers selectively disclose their portfolios and emphasize only certain aspects of options trading. As a result, clients may not understand how much of the influencer’s income depends on such strategies, and may overcommit their own funds in pursuit of similar profits. ​This is a classic example of information asymmetry between a “financial coach” and an aspiring trader. Similarly, online trading games, betting platforms, and gambling apps glorify quick money and deliberately target vulnerable individuals seeking financial gains. The algorithms are arranged to convince players of their supposed ‘luck’ and foster overconfidence in many players. Then begins the vicious cycle of debt trap. Hence, the rise of financial influencers and the gamification of trading through mobile apps has created an environment where young Indians are drawn into high-risk derivative trading without fully understanding the odds stacked against them. Therefore, it is crucial to remember that sustainable wealth creation comes through education, skill development, and long-term investing - not through speculative trading strategies promoted on social media (NISM, 2023).

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SEBI imposed its penalty on July 3, 2025, and the market's reaction revealed just how dependent India's derivatives ecosystem had become on Jane Street's operations (SEBI, 2025). On July 4, 2025, the derivatives market turnover crashed by 21%— from INR 601.2 lakh crore to INR 472.5 lakh crore. This wasn't just a temporary blip, it represented the lowest turnover since May 8, 2025.

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For SEBI and India's markets, this case wasn't just about one foreign trading firm,it exposed fundamental flaws in how India regulated its financial infrastructure.Before the scandal, index providers operated with minimal oversight, loose disclosure requirements, and essentially self-regulated. The Jane Street case forced a complete re-evaluation of this approach.

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​Policy implications

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Index providers now are required to register with SEBI as Market Infrastructure Institutions, placing them on par with stock exchanges and clearing corporations. SEBI deployed AI-based systems to monitor price-volume spikes before index announcements and implemented real-time surveillance of expiry day trades. Fund managers must now disclose rebalancing dates and strategies with greater frequency, and enhanced audit trails are mandatory for compliance teams. NSE and BSE revised index publication calendars to reduce timing asymmetries and implemented stronger surveillance mechanisms (Shekhar, 2025).

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Meanwhile, the derivatives market continues to grapple with the aftermath. SEBI’s September 2024 study covering FY22–FY24 found that over 90% of retail traders incurred net losses (SEBI, 2024, Research Report). Subsequent media reports citing SEBI’s provisional FY25 data indicated that 91% of retail traders continued to lose money, with aggregate losses widening to INR 1.06 lakh crore — a 41% increase from FY24 (Economic Times, 2024).

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The Jane Street case vindicates the principle that market integrity must anchor India’s financial future.​

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The Jane Street case vindicates the principle that market integrity must anchor India’s financial future. Regulators now face a lucid but credible challenge: an arms race where marginal analysis of innovation must be weighed against fairness, and where time preference for short‑term gains cannot eclipse long‑term stability. Success will mean reforms that enhance earnings visibility and investor confidence, rather than cursory fixes that leave markets vulnerable to manipulation.

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