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The concept was first brought to the public by the UK website Flutter.com in May 2000 followed closely by UK-based Betfair in June 2000. Betfair more faithfully followed an exchange model and grew more quickly. Betfair merged with Flutter leaving Flutter shareholders very much in the minority. Flutter's customers were transferred to Betfair's system. Betfair now process the vast majority of exchange betting transactions globally. The sites usually make money by charging a commission which is calculated as a percentage of net winnings. Losers do not pay anything to use the exchanges.
Gamblers whose betting activities have traditionally been restricted by bookmakers (normally for winning too much money) have found these sites a boon since they are now able to place bets of unrestricted size, providing always of course that there is someone available to match them. Prices offered often tend to be better than bookmakers despite the commission charged.
These exchanges also offer the oppurtunity to lay outcomes, which is to back that a particular participant in an event will lose. This is the position bookmakers take when offering a bet for somebody to back that the participant will win.
For example, if I think Team A will win a competition, I may wish to back that selection. A bookmaker will lay that selection. We will agree the backer's stake and the odds. If the team loses, the layer or bookmaker keeps the backer's stake. If the team wins, the layer will pay the backer winnings based on the odds agreed.
The fact that gamblers can now lay outcomes on the exchanges has caused tremendous criticism from traditional bookmakers with much of the anger coming from the UK's "Big Three" - Coral , Ladbrokes and William Hill . These firms argue that granting who they consider to be anonymous punters the ability to bet that an outcome will not happen is causing corruption in sports such as horse racing (since it is much easier to ensure a horse will lose a race, the bookmakers reason). Exchanges such as Betfair counter that while corruption is possible on any gambling platform, the bookies' arguments are motivated not by concern for the integrity of sport but by commercial interests. Exchanges also assert that they are well aware of who their customers are and Betfair in particular has noted that they have signed numerous agreements with governing bodies of sport including the Jockey ClubThe Jockey Club is responsible for the day-to-day regulation of United Kingdom horse-racing. In conjunction with the British Horseracing Board and the Horserace Betting Levy Board, it is one of the three bodies which provide management for horse racing in, with whom they insist they will co-operate with fully if the latter suspects corruption to have taken place.
In the summer of 20042004 is a leap year starting on Thursday (the link is to a full 2004 calendar), and has also been designated the: International Year of Rice International Year to Commemorate the Struggle against Slavery and its Abolition Elections are to be held in 73 co, Betfair provided data to investigators, including the City of London PoliceThe City of London Police is the police force responsible for the City of London. The Metropolitan Police is responsible for the rest of London. It has about 1,200 employees and police stations on Snow Hill, Wood Street, and Bishopsgate. The commissioner which on September 1September 1 is the 244th day of the year (245th in leap years). There are 121 days remaining. Events 5509 BC The world was created, according to the Byzantine calendar. 327 start of first indiction cycle 1715 King Louis XIV of France dies after a reign of lead to 16 arrests on charges related to race fixing. Among those arrested was champion jockeyIn sports, a jockey is one who rides horses in racing, primarily as a profession. Jockeys are nominated by horse trainers to ride their horses in races, usually for a fee (which is paid regardless of the prize money the horse earns for a race). Jockeys us Kieren FallonKieren Fallon (born February 22 1965) in Crusheen, County Clare Ireland is a flat racing jockey and has been United Kingdom champion jockey six times. In 1984 Kieren rode his first winner, Piccadilly Lord, at Navan. He came to England in 1988 to ride for, whose case remains before the courts as of this writing.
See also Gambling, Bookmaker, Parimutuel gambling and Spread betting.
Betting exchanges: BETDAQ, Betfair, iBetX, Redbet , SportingOdds