When it comes to online sports betting, one of the most popular formats of betting online in the past few years is by using a betting exchange. Betting exchanges are a lot different from your traditional sportsbook.

There are two main betting exchanges online. For Americans Matchbook is your only option, while for all users outside the US you can use the excellent and infamous Betfair Betting Exchange.

But what exactly is a betting exchange? And what is the difference in a betting exchanged compared to a regular sportsbook, online or offline?

Betting exchanges at their core allow the user or gambler to choose their own odds. No longer do you have to be restricted to the odds that each individual sportsbook sets. Let’s say there is a world cup match between Brazil and England. You believe England can win this game 1 in every 4 games, but the bookies are only offering 3/1 odds.

Rather than being stuck with these odds, you can go onto a betting exchange like Betfair, and choose to place a bet for England at whatever odds you want, say 4/1, to win the game. This doesn’t mean the bet is actually placed – this just means you want those odds. What someone else has to do is come along and match the bet. These users can also partially match the bet, and multiple users can be matching your bet, and thus basically becoming “bookmakers” themselves.

That’s what exchanges allow you to do – they allow you to dictate the odds, and also allow you to become a bookmaker yourself. All the exchanges allow live betting as well. Let’s say you are watching an NFL football game between the New England Patriots and the Tennessee Titans. The Patriots are down by 2 points but have a 40 yard field goal. You don’t believe they will make the field goal – so you can hop onto Betfair or Matchbook, and see what bets people are looking for action on.

Someone may have odds at 3.51 on the Patriots to win the game. You believe they will miss the field goal 2 out of every 3 times, so you take those odds, “laying” the bet so to speak, and thus become the bookmaker. If you lose the bet you have to pay out the money at those odds, while if the gambler loses the bet then you make the exact money that he bet.
In essence, that’s exactly what a betting exchange is, and how it differs from a sportsbook:

Try out a betting exchange today:

• Matchbook (US Only)
• Betfair (Non-US)

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