Will US sports betting markets ever embrace the concept of sports betting exchanges? If the news coming out of New Jersey is any indication, the answer to that question is a resounding, “NO!”.
According to a recent report on ThoroughBredDailyNews.com, Betfair is shuttering its New Jersey-based sports betting exchange due to a lack of interest from the betting public. In this case, the betting exchange BetFair set up with with Darby Development, the operator of Monmouth Park to create the horse racing exchange. (Basically a horse racing sportsbook where players make their own odds and accept wagers from other players at those odds.)
Given horse racing’s older demographics and limited reach, a product with a learning curve like a sports betting exchange was a pretty risky bet from the get-go. Nonetheless, some major players in the New Jersey sports betting world are still pretty bullish on the idea.
Kip Levin, the COO of FanDuel Group, now the parent company of Betfair described the situation saying, “When we launched in 2016, we felt like exchange wagering, popular elsewhere, was worth trying in New Jersey to see if it could increase new fan interest in racing. For a variety of reasons, including a customer base used to exotic wagers and a reluctance by major US racing associations to embrace the different business model, it never hit the critical mass needed for it to be viable.”
The lack of liquidity in localized sports betting markets is a major hurdle for any US-facing exchange, including Sporttrade, which is pitching the same idea at the wider sports betting market.