Nepal, Jan. 1 -- As the year 2025 comes to an end, the Nepal Stock Exchange (NEPSE) index floats resiliently above 2,600, and market capitalisation expands into trillions of rupees. This appears similar to financial modernisation, a shift from a niche club of elite investors to a mass movement fuelled by digital access. The over 6.3 million trading accounts in use today mark a significant surge from 740,000 accounts in early 2020.

However, this democratisation is a veneer masking a structural fragility. We are not witnessing healthy capital formation but a classic rational bubble fuelled by an unprecedented glut of liquidity. Beneath the digital hum of the trading management system lies a market plagued by information asymmetry, regulato...