India’s market regulator SEBI on June 24 ordered market intermediaries such as exchanges and brokers to provide “live” data to third-party platforms offering virtual trading, thrilling fantasy games and educational courses. announced new regulations prohibiting this. In response, nearly half a dozen startups built around stock games are closing shop, pausing, or considering changing direction, Moneycontrol reported.
Meanwhile, companies that planned to use older data are struggling to retain younger customers as the adrenaline of live games and simulations for leisure and learning wears off.
Stock game apps are closed
According to Moneycontrol, Accel and Kunal Shah-backed Trinkerr have suspended their gaming products to consider their next course of action. Similarly, Investro, the Dream Sports-backed fantasy stock app, has also been discontinued and is accepting withdrawal requests.
“The broader impact of these regulations appears to be aimed at curbing illegal data use and stock market gamification. While we support measures to protect investors, “Restricting data usage completely can inadvertently limit access to valuable educational resources that platforms like ours provide,” Manvendra Singh, co-founder of Trinkerr, told MoneyControl. told.
Trinkerr revealed that it uses data with a 5-minute delay, and that it is not a pure gaming app, but also focuses on educational aspects.
“Data delays, especially fluctuations in expiration dates in F&O trading, can introduce inaccuracies in the market conditions that users explore, causing confusion and detracting from the educational experience,” Manvendra Singh told Moneycontrol. spoke.
Moneycontrol’s report further added that over the past two years, many stock game shops have closed their doors due to their inability to make a strong case for stock games.
“The last few years have been changing. We foresaw this circular itself last year and pivoted our business model to other markets,” said the co-founder and co-founder of StockPe, a gamified stock market app. CEO Shubham Rawal told Moneycontrol.
Sebi’s order
SEBI’s crackdown comes amid growing interest among retail investors, particularly in futures and options (F&O), as well as concerns about the expansion of parallel areas beyond its purview. Moneycontrol quotes Sanjam Arora, partner at Trilegal, as saying SEBI is concerned about social trading apps potentially bordering on gambling, but views social trading apps as skill-based games. He said some people argue that it should.
“SEBI is concerned that these apps do not provide users with the protection normally available to investors in the stock market. They also create a high-risk environment among users by “gamifying” the trading experience. There are also concerns that behavior could develop that could spill over into real-world trading behavior,” she told Moneycontrol.
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