2 min read Last updated: May 24, 2024 | 9:08 PM IST
The Securities and Exchange Board of India (Sebi) on Friday restricted the sharing of real-time market data on stock prices with third parties in a bid to crack down on fantasy gaming and virtual trading platforms.
The market regulator has directed stock exchanges, clearing members, depositories and securities companies not to share real-time price data with third parties.
It also directed market intermediaries to formalize data sharing agreements and specify the reasons for requesting real-time data.
“The MII or market intermediary shall enter into appropriate agreements with the entities with which it intends to share real-time price data, including the justification that such agreements are necessary for the orderly functioning of the securities market; It shall prescribe the activities by which companies use real-time price data,” Sebi said.
At least once every fiscal year, the list of activities and entities that use this data must be reviewed by the MII’s Board of Directors.
The move comes amid a growing trend of betting, leagues and trading on these online gaming platforms using real-time data on price movements. These games may have entry values and prizes. Users compete to see who can create the best performing portfolio linked to actual stock performance.
“Some platforms even offer financial incentives based on the performance of virtual stock portfolios,” Sebi says.
Stock exchanges provide real-time data as a paid service to brokers and subscribers in various market segments.
If market data is to be used for educational programs, regulators have instructed companies to share it with a one-day delay.
“Market price data may be shared with a one-day delay for investor education and awareness activities without providing any financial incentive to participants,” Sebi said.
The new standards will take effect in one month.
First published: May 24, 2024 | 9:08 PM IST
