What is Betting Exchange?
For starters, betting exchange allows users to bet against other individuals within that exchange as opposed to betting against a bookmaker in traditional betting.
To put simply, users of a betting exchange bet on or against something that is happening or will happen in the play against other users who bet in the same betting exchange.
For example, a user on a betting exchange will bet that Manchester United will win the Champions League while others bet that they won’t. Similarly one can bet that Ronaldo will score 2 goals in a match while some bet he scores 1, or few others something else.
Benefits of a Betting Exchange compared to Traditional Betting with Bookmakers
- Bookmakers will decide the odds where is a betting exchange user can set their own odds;
- The margins are usually higher since there is no bookmaker involved;
- You can change your bets in midway. If the team you have bet to win is actually winning most of the games in a tournament, the odds will drop. You can now lay the bet. I.e. bet against that team at lower odds to lock in the profits;
- Users do not have problems like closures of their accounts and bet cancellations which are common with bookmakers.
What are the most popular betting exchanges?
This is a list of the most popular betting exchanges based on the numbers of odds, liquidity and signups – Betfair Betdaq Smarkets Matchbook
How the betting exchanges compare with each other?
If you want to know which betting exchange is the best one, it would be a difficult to answer. There are lot of things that need to be considered like liquidity, commissions they offer, joining bonuses, content etc. Let’s see how each of these betting exchanges compares with each other.
Commission Rate: 5%
Free Bet: £0 (£30 free bet available at Betfair Sportsbook)
By far the biggest of all the betting exchanges going by the number of users signed up, Betfair is also the first betting exchange. Though their commission rates are high, they drop as you increase your bet size. They have an excellent liquidity, probably higher than all the others, and is the best betting exchange for regular and frequent bettors. Unlike the other betting exchanges who are offering free bets as a norm to attract bettor, they do not offer any free bet. They do give a free bit worth £30 though as part of their Betfair sportsbook.
Being the oldest in the business, they are trustworthy with a website that functions really smoothly and the bets can be placed for as low as £2.
Commission rate: 5%
Free Bet: £25
Founded just sometime after Betfair, they are the second biggest and oldest betting exchange. Their liquidity is low compared to Betfair and have the same commission rate of 5% which will again drop as you increase your bet size. Where they win against Betfair is their attractive offer of £25 free bet when you join.
Their website can be a drag and boring one when it comes to design but works as good as how a betting exchange has to. As an exchange that is in business since a long time, they are trustworthy too. If liquidity is not a major issue for you, you can take the advantage of their free bet.
Commission Rate: 2%
Free Bet: £10
A relatively new entrant to the bit exchange market, Smarkets have a very attractive commission rate of 2% which is a flat one irrespective of the number of bets. Their liquidity is also pretty good and they offer a £10 free bet. Overall, this looks like a more competitive bit exchange to Betfair. A bit exchange to watch out for.
The software and the interface of their website is great and have a very neat design. They have been a very attractive business in betting exchange circle in the most recent times and they are particularly known for their football bets. If liquidity and commission rate are your prerequisites, this is a betting exchange worth considering. You can also take the advantage of their free bet of £10.
Commission Rate: 2%
Free Bet: £20
Matchbook also has a low commission rate among all the other top bit exchanges at only 2%, along with Smarkets. In the past, they used to charge commission rate even for the losing bets unlike others. The good news is they don’t do it anymore but the commission rate has been revised to 2%. While that does not make them lowest commission charges anymore, you wouldn’t be impacted in case of bet losses. They also offer a £20 free bet.
Talking about their website, it is basic but clean design that does the job just fine. While their liquidity is not great, it isn’t bad either. You can say they have a very competitive one there. They are
a trustworthy exchange of sports bets too. If you are looking for the low commission rate, have the confidence of betting smartly, and liquidity is not the topmost of your requirement, Matchbook is worth giving a shot.
Sports Exchange Comparison table
To sum up, each sports bet exchange has their own unique advantages and features they offer to bettors. While choosing the most appropriate sports exchange for your bets, you should consider various things like commission rates, amount of free bets and the number of odds available along with liquidity.
While Betdaq seemed to be falling away in their competition with Betfair and their declining liquidity, they got a lifeline when they were acquired by Ladbrokes who can pump in some funds into their accounts. Matchbook has everything others offer, but what they lack is great liquidity. If they can improve on that, they can be as good as others.
Betfair has a definite edge over others, but the rest of them offer attractive promotions like free bets and very competitive commission rates that could offset the other things. Smarkets is one such sports betting exchange who have really grown in popularity. They are also able to attract large number of users joining their platform for their attractive commission rates and liquidity.
However, right now our odds are on Betfair to be the best betting exchange in the world with their massive pool of users, odds and liquidity. In fact, you must have an account with Betfair if you are betting on football.
We would like to finish though by saying it is worth having an account with all of them, or at least each one of them before you decide on one particular exchange as they all are capable of giving better returns.