The introduction of betting exchanges to the world of online gambling around the turn of the century was a game changer.
It provided players with the opportunity to move away from the traditional fixed odds betting platforms of traditional bookmakers and into peer-to-peer betting.
While both platforms use the marketing of welcome bonuses (betting sites can provide offers like bet 10 get 20, or a matched deposit bonus, and at betting exchanges new users often get 0% commission for the first days after registering), there are significant operational differences between the two when it comes to sports betting. Exchanges can have a steep learning curve compared to fixed-odds sportsbooks but can provide much stronger odds, for example.
Because of the differences, many punters choose to use a combination of both for regular betting. But what about long-term wins by players? Traditional bookmakers typically have a reaction to successful bettors, which could include bet restrictions. How do betting exchanges handle the situation of consistent winners?
The Long-Term Winners
Anyone successful at betting is going to be watched carefully by a bookmaker. A typical success-rate target for sports bettors is between 52-55%, which is a hard number to achieve for casual punters, just due to the unpredictability of gambling.
Why do bookmakers care? Well, there’s their profit margins to start with and their security. Any player that is consistently producing a profit at any of the top 20 betting sites UK, will likely have their betting patterns checked to make sure there is nothing suspicious.
Bookmakers typically don’t expect bettors to be successful over the long term – in fact, they bank on it not happening, because it’s long-term sustainable profit for them when punters lose. A bookmaker will absorb a player hitting a 6-fold accumulator on the horses, for example, because it’s a rare event. But for payers who consistently earn profits, well, that’s not great for the bookmaker’s business.
Bookmakers can also limit the amount of stake per bet for a successful bettor as well, just to try and reel things back in their favour. When it comes to the point of making a withdrawal after a successful run of wins, further security checks involving personal and banking information will probably crop up too.
A Different Approach
Sports betting exchanges will handle this scenario a little differently from traditional bookies. They will still carefully watch their numbers and be concerned about any potential foul play happening for consistent winners, of course. But there are some significant differences as to why they may not care quite as much as traditional bookmakers.
Peer-to-Peer
Betting exchanges are essentially bettors wagering against one another. So the betting exchange itself is simply a platform for that to happen, and therefore the operator is not assuming the risk that a traditional bookmaker does on a bet.
The betting exchange makes its money via commission from winning bets. So regardless of which way the result of a Premier League match goes, for example, the betting exchange operator is still going to get their commission.
Exchanges Dodge Sharp Bettors
All bookmakers worry about the “sharp bettor”, those who are consistently good at beating the odds, as those are punters who can hurt the profit margins of bookies. Things are not quite the same for betting exchanges, because the exchange doesn’t set the odds – that’s done instead by bettors matching prices. So it’s of little concern to an exchange operator if a sharp bettor is running with a high win percentage.
Extra Charges
That’s not to say that a betting exchange won’t keep a close eye on anyone that’s winning regularly, and make a move. What has become a little more common on exchange platforms is a premium charge. This is something that the regular, causal punter is not going to have to worry about, as it is only levied against what can be deemed ‘elite’ bettors.
It’s an additional fee served up to players who are consistently making a profit on an exchange (as well as meeting other criteria). The fees are essentially like a higher commission rate, as it’s calculated at a percentage rate of the gross profits earned by an ‘elite’ bettor.
In Conclusion
Betting exchanges are just modelled in a very different way from traditional bookmakers and importantly they don’t carry the burden of risk. The exchange is there to facilitate different parties betting against each other, bettors who are prepared to meet the liability of a market, for example.
The exchange’s profit comes from the commission they charge and so that cut out elements like margins, accurate odds pricing and liquidity on markets, meaning that they are less likely to care about your long-term wins.
