Sporttrade – A Sports Betting Stock Exchange

Introducing a new sports betting exchange that runs like a stock market.

It’s been a couple years now since online sports betting first came to the United States (legally, that is). Nevada, New Jersey, Pennsylvania, and Indiana were among the first states adopting states, with many more to follow. For the most part, each state presents a similar line of products, and each product virtually mimics the next. Aside from a unique (higher risk/higher reward) points betting system offered by PointsBet, there’s nothing that really sets one company apart from another. At least, not yet – but it’s coming.

Alex Kane is the CEO and mastermind behind Sporttrade Inc., a revolutionary new mobile betting product. Sporttrade is not your typical bookmaker app. It is, quite literally, a sports betting stock exchange. Kane’s vision is melding sports gambling with financial markets, developing a fresh new product that’s sure to appeal to today’s younger, tech-savvy generation.

Envisioning a New Sports Betting Exchange

In an interview with The Philadelphia Inquirer, Kane tells us how he got the idea for Sporttrade. It happened five years ago he was a Junior at Dexter University. Kane and his father placed a wager on a long-shot golfer to win the 2016 Masters Tournament. His pick, Kiradech Aphibarnrat, hit the ground running. After two rounds, he was just a few strokes behind the leader.

Compared to the start of the tournament, odds on Aphibarnrat to win were up near x100. It was at that moment that the entrepreneurial minded young Kane wished he could sell his bet. But this was a bookmaker, not a financial market. Instead of cashing in for the early payout, every penny of the wager was lost when Kiradech Aphibarnrat finished in 15th place.

“That’s when I realized, ‘Oh, my gosh, this structure stinks,’” Kane retells this history of Srpottrade. “It should be way more like capital markets trading, where like I’m able to pick up Robinhood or Coinbase and trade based on the changes in the market.” Thus, the concept for a sports betting market exchange was born.

Sports Betting, Meet Stock Trading

Last month, Kane’s brainchild hit the world wide web via www.sporttrade.com. It’s touted as, “the first dynamic sports betting and trading exchange where you can trade sports bets like you trade stocks.” It’s not live yet, but will soon launch in the state of New Jersey; possibly as early as late summer, pending regulatory license approval. From there, it should roll out across additional states in 2022.

Kane likens Sporttrade to in-play wagering with an options trading twist. When you place a bet, you’re buying a contract. The contract price and value are based on the current odds of getting a positive result.

For example, let’s say the New York Yankees are the 67% favorite, with each contract (like stocks/shares) selling for $67. You might buy 10 contracts for $670. As the game goes on, if the team performs well, their odds to win may increase to 85% in the 7th. You could sell the contracts for $850 at that point, or for their current value at any point in the game. Maybe you want to 5 of the contracts for $425, and let the rest ride.

Just like options trading, you can buy or sell what you want, when you want. If you hold on until the game is over, those contracts will either be worth $1,000, or $0, depending on whether the Yankees win or lose.

In-Play Betting Already Exists – How is Sporttrade Better?

To say one is better is to express an opinion, not a fact. Everyone has their opinions, and their own preferences. What we can say for certain is that they are different, and that there are surely people out there with financial market experience that would prefer the Sporttrade model. One such individual is Jack Andrews, a professional sports bettor from New Jersey.

In terms of traditional live betting, Andrews finds that, “if you’re not betting at the timeouts or between the quarters…then there is a delay. It seems like they’re getting a free roll against you.”

Kane agrees with this assessment. With those delays – the result of game analysts deciding if the odds are good enough to post or not – “it doesn’t feel like you as the customer are in control”. His model adapts the electronic systems that currently handle lightning-fast trading in financial markets to create an equally manageable platform for buying and selling sports bets, without the delays. Thus, bettors like Andrews are prime candidates for making the switch to a sports betting stock exchange.

It Almost Sounds Too Easy. What’s the Catch?

There’s no catch really, but there is one important factor you need to be aware of. Sporttrade is a not a sportsbook, but rather a betting exchange. This means that the bettors themselves are the ones buying and selling the bets, not the Sporttrade operator.

Because it is a betting exchange, rather than a bookmaker, the exchange acts as a neutral party and therefore assumes no risk. Sporttrade will collect a nominal commission on each wager, but is not financially responsible for collecting winnings or paying out losses. The operation is only there to match buyers and sellers, and facilitate the movement of contracts in real time.

Assuming Sporttrade is able to attract a mass customer base, the system should run smoothly. But it only works if both buyers and sellers are present, and willing to deal at the given prices. Sporttrade’s market managers set the “bid” (buy) and “ask” (sell) prices for events, but the buyers and sellers make it work. If no one wants to buy your contract, you can’t sell it. And if no one is willing to sell a contract, you can’t buy it.

The good news is that New Jersey is the perfect testing ground for a sports betting exchange such as this. Once legalized, New Jersey quickly surpassed Nevada as the top grossing US state for online and mobile betting. By focusing on the most popular sports, there will surely be contract buyers on both sides of all major contests, as well as sports futures markets.