What Is a Betting Exchange? And How Does It Work?
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Last Updated: 6 August, 2025
A sports betting exchange is a platform where people bet against each other instead of a sportsbook.
It removes the middleman and offers better odds.
Users can back or oppose outcomes, and the exchange takes a small fee only on winning bets.
This peer-to-peer model gives more control and often lower costs than traditional sportsbooks.
How does a betting exchange work?
A betting exchange works by matching two users who want to bet on opposite outcomes.
One person places a bet (called a “back” bet), and another accepts it by betting against that outcome (a “lay” bet).
The exchange doesn’t take sides; it just connects the two users and holds the money until the event ends.
Instead of building the profit into the odds like a traditional sportsbook, online betting exchange sites charge a small commission on winning bets.
This often brings the odds closer to -101 instead of the usual -110 you’d see at most sportsbooks.
For example, if you think a team will win, you can back them.
If another user disagrees, they can "lay" the same team.
The betting exchange online then locks in both bets and pays out the winner based on the agreed odds.
This system gives users more freedom, better prices, and fewer restrictions, especially for high-volume or sharp bettors.
How to use a betting exchange
Using a betting exchange is simple once you know the steps.
Here’s how it works:
This setup gives you more control than an online sports betting site.
You're betting directly with other users, not the house.
Pros and cons of online betting exchanges
Pros
- ✅ Lower fees mean better odds compared to traditional sportsbooks
- ✅ No limits placed on sharp or high-volume bettors
- ✅ Back or lay bets to create flexible strategies
Cons
- ❌ Limited users make it harder to match bets on smaller events.
- ❌ No parlay boosts, rewards, or sportsbook-style promotions.
- ❌ Fewer markets and features compared to large sportsbooks.
Betting exchange vs sportsbook
What’s the difference between a betting exchange and a sportsbook?
Here’s a simple breakdown:
For experienced bettors, exchanges offer more freedom and better prices.
But sportsbooks and sports betting apps are still more convenient for quick bets and promotional value.
Real examples from betting exchange sites
Several betting exchange sites now operate legally in parts of the US.
These platforms follow the peer-to-peer model and offer tighter odds than traditional sportsbooks.
Example: Prophet exchange
Prophet Exchange is live in New Jersey.
It lets users back or lay bet on major US sports like the NFL, NBA, and MLB.
The site charges a low commission on winning bets and doesn’t limit accounts based on performance.
Example: Sporttrade
Sporttrade also launched in New Jersey and offers a unique trading-style interface.
Odds are displayed like stock prices, and users can enter or exit positions during live games.
Both of these exchange betting sites show how peer-to-peer betting works in practice:
Users post bets with custom odds.
Others accept or reject the offers.
The exchange holds the money and pays out the winner.
Here’s a quick list of betting exchange sites operating or emerging in the US:
Prophet Exchange (New Jersey)
Sporttrade (New Jersey)
Betfair (available internationally, not in the US)
Sports covered: From cricket to horse racing
Betting exchanges cover many of the same sports as traditional sportsbooks, but some markets stand out because of how the peer-to-peer model works.
Cricket betting exchange
Cricket is one of the most active sports on international betting exchanges like Betfair.
Fans can back or lay outcomes in test matches, T20s, and international tournaments.
Because cricket has so many variables, like innings runs, wickets, or series winners, users find real value in setting their own odds.
In the US, cricket markets are more limited, but that could grow as exchanges expand.
Horse betting exchange
Horse racing is another key sport for exchanges.
A horse betting exchange lets you bet on a horse to win or lay a horse, meaning you bet it won’t win.
That’s not something you can do with a typical sportsbook.
Exchanges also allow users to trade bets before or during a race, which adds strategy and flexibility.
While most US betting exchanges focus on major team sports, cricket and horse racing could become more popular as peer-to-peer platforms grow.
Betting exchange tips & strategy
If you’re new to betting exchanges, the setup might feel a little unfamiliar at first.
But once you get the hang of it, you’ll see how much control you have, and how much better the odds can be.
Here are a few tips we’ve learned through real use:
1. Start with back bets
Backing is just like betting at a sportsbook: you're betting for something to happen.
If you’re just getting started, place a few back bets on teams or outcomes you already know.
It helps you learn the platform without overthinking the strategy.
2. Learn how to lay
Laying a bet means you're betting against an outcome, like saying a team won’t win or a player won’t score.
It’s a powerful tool, especially for betting on futures or big tournaments where many outcomes are in play.
Once you’re comfortable backing, give lay betting a shot on a smaller market.
3. Watch the market
Odds on a betting exchange move based on supply and demand.
If a lot of people are backing one side, the price may drop.
It pays to be patient, especially right before game time.
You can often get a better price by waiting or setting your own odds and letting someone else accept them.
4. Think like a trader
Some experienced users treat betting exchanges like stock markets.
They’ll enter a bet early at one price, then trade out of it later by placing an opposite bet, locking in profit, or minimizing loss.
It takes some practice, but it gives you a new way to think about risk.
5. Focus on liquidity
Not every market has enough users to match your bets, especially for niche sports or off-hours games.
Stick to high-traffic events, like the NFL, NBA, or major soccer matches, when you’re starting out.
Final tip: Take your time
The best betting exchange strategy isn’t about chasing big wins.
It’s about understanding the flow of the market and placing smart, well-timed bets.
You don’t have to rush; your edge comes from being selective and letting others come to you.
Frequently asked questions
Why you can trust us
At Sporting Post, we focus on providing accurate and unbiased information in every article we publish.
Our team of sports betting experts thoroughly researches and tests each betting platform we review.
We follow strict ethical guidelines to ensure editorial independence and avoid conflicts of interest.
We also update our content regularly to keep it current with the latest trends and changes.
Simply put, we are dedicated to giving you reliable, fact-based details about the top betting sites.
Editorial policy
Our editorial policy ensures thoroughly researched, accurate, and unbiased content through strict sourcing standards and diligent review by top sports betting experts and seasoned editors.
This process maintains the integrity, relevance, and value of our content for our readers.
References
Contributors
Bradley Gibbs
Author
With over 12 years of experience, Bradley Gibbs is a seasoned sports betting writer and analyst specializing in uncovering value bets across football, horse racing, tennis, and golf.
His extensive coverage of these sports has been featured on numerous websites and in The Racing & Football Outlook, a renowned UK betting publication.
Bradley's expertise lies in identifying betting edges and delivering insightful, data-driven content for informed wagering.
Josh Miller
Reviewed By
Josh Miller, Sporting Post’s Sports & Casino Editor, brings over five years of experience in feature writing, blogging, and SEO.
With a strong background in football coverage and sports betting, his work has been featured in VAVEL.
Josh also writes extensively about online casinos, providing expert insights into games, bonuses, and gambling trends.
His engaging and informative content makes him a reliable resource for Sporting Post readers.