Jane Street Readmitted to Indian Markets After Significant Deposit

India's financial markets regulator, the Securities and Exchange Board of India (SEBI), has permitted the US-based trading firm Jane Street to recommence its trading activities. This decision follows the firm's deposit of $567 million, as confirmed by two sources familiar with the situation on Monday.

On July 3, SEBI imposed an interim order that restricted Jane Street from engaging in both buying and selling securities within India. The firm was required to deposit an equivalent sum in an account controlled by the regulator before it could resume trading. The purpose of this measure was to provide SEBI leverage until its ongoing investigation concludes.

On Friday, SEBI communicated through email that the conditions of the interim order no longer apply after the deposit was made. However, the sources, who preferred to remain anonymous due to the sensitivity of the information, noted that the two major Indian stock exchanges, the National Stock Exchange of India Ltd and BSE Ltd, have been instructed to maintain oversight of Jane Street's transactions.

Despite receiving clearance to trade again, Jane Street has committed to SEBI that it will abstain from trading options for the time being. Furthermore, it has opted not to engage in cash trading until it can clarify its previous trading activities to the regulator. One source pointed out that while the firm has gained approval to re-enter the market, the exchanges have yet to enable the actual buying and selling of securities for Jane Street.

Jane Street, known for its high-frequency trading techniques, remains a significant player in the global financial landscape and its activities in India have attracted considerable attention within the investment community. 

As of now, representatives from both Jane Street and SEBI have not replied to requests for comments directed to them. This development is critical not only for Jane Street but also for the broader context of foreign trading firms operating within India's financial markets.

In a statement highlighting the situation, an expert analyst said, "The re-entry of Jane Street into Indian markets indicates a positive sign for foreign investment confidence. It reflects the regulatory framework's ability to adapt while ensuring compliance." 

As Jane Street resumes operations, many stakeholders will be watching closely for updates on any further guidance from SEBI or movements in Indian financial markets. This incident underlines the dynamic nature of international trading regulations and their implications for market participants worldwide.