Core Viewpoint - Jane Street has denied all allegations made by the Securities and Exchange Board of India (SEBI), claiming that its reputation has been tarnished by "erroneous or baseless reports" [1] Group 1: Allegations and Responses - SEBI issued a temporary ban on Jane Street, accusing the firm of "malicious market manipulation" and freezing its funds amounting to 48.4 billion rupees (approximately 4 billion yuan) in India [1] - Jane Street emphasized that its trading activities are based on standard arbitrage and hedging strategies aimed at ensuring price consistency of financial instruments and providing necessary market liquidity [1][2] Group 2: Specific Trading Practices - In a 105-page investigation report, SEBI focused on two controversial trading practices: intraday index manipulation and closing price manipulation, using a specific trading example from January 17, 2024 [2] - Jane Street refuted the intraday index manipulation claims, stating that the questioned trading behavior was a routine index arbitrage operation, aimed at narrowing the price discrepancy between the BANKNIFTY index in the stock and options markets [2][4] Group 3: Risk Management Strategies - Regarding the closing price manipulation allegations, Jane Street argued that due to the unique cash settlement period for options in the Indian market, liquidity providers must hedge their risk exposure before options expiration, which is a globally accepted risk management strategy [4] Group 4: Communication with SEBI - SEBI accused Jane Street of lacking cooperation and ignoring regulatory communications, stating that the firm's actions constituted an "emergency risk" [5] - Jane Street countered that it has been responsive and transparent since SEBI's request for trading information in August 2024, and has actively communicated with exchanges to adjust trading practices [5] - The company expressed disappointment over SEBI's failure to respond to multiple requests for dialogue while issuing reports claiming the firm ignored concerns [5]