The idea of person-to-person betting inevitably raises some questions in people’s minds:

How can I be sure I will get paid?

The issue of payment is a simple question to answer.  Every bet is collateralized, which means that you have to put your entire liability up front.

How do I know someone isn’t cheating me?

The question of insider information has also been addressed by the betting exchanges.  They minimise the chances of people misusing information by reaching information-sharing agreement with sporting bodies to ensure that the rules of the game are upheld.  Under these agreements - Memoranda of Understanding - exchanges can pass on information relating to the bets of their customers to the administrative body of the sport in question, if it is suspected that the rules of that sport have been broken or misused in any way.  It is a condition of using the betting exchange that you agree for that information to be given up if requested.  In this way the capability of policing is significantly improved and its effect has been welcomed by sporting bodies across the world.

Isn’t there a worry that people will start to rig events if they can bet on outcomes not happening?

It is sometimes argued that exchanges allow people to rig events, but it is also argued that agreement with sporting bodies actually increases the ability to detect corruption by creating a clear and transparent audit trail through which suspicious betting activity can be monitored.  While betting exchanges may have made the mechanism by which you can make a bet on an outcome not happening much simpler, they have not increased the number of people who are connected with the sporting event in question, who have always been able to bet on teams and horses to lose in any case.   Many would argue that by clarifying the process of placing bets, betting exchanges have increased the ability to police it.  However, the bottom line with corruption is that there will always be someone who tries to take advantage of any system.  But try corrupting sport on a betting exchange and it’s very short odds that you’re going to get caught!

Of course, it is true that these questions have been asked by the betting exchanges themselves when the concept was launched.  If they hadn’t asked them then the success that they have had in such a short period of  time would not have occurred .  If there is any real doubt surrounding the integrity of the product, people won’t use it, and millions of bets going through every day prove that this is not the case.

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