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European sports betting operator Smarkets announced today it had reached a multimillion-dollar deal with casino operator Full House Resorts in the US. That deal gives it access to the now open Indiana sports betting market, as well as to Colorado should it enact a referendum this fall.
The tantalizing prospect for US bettors is the possibility of Smarkets bringing its betting exchange to the US.
First, the Smarkets deal for the US
Smarkets already has a foothold in the US with an office in Los Angeles. So, it was always going to be in the market somehow.
While best known as a betting exchange, Smarkets also offers a recently created traditional sportsbook product. That will be what bettors see at first in Indiana, Colorado and any other state the company gains access to in the short term. For now, Smarkets will be working with Full House via Bronco Billy’s Casino and Hotel in Cripple Creek, Colo., and Rising Star Casino Resort in Rising Sun, Ind. Full House also owns or operates casinos in Mississippi and Nevada. Both have legal sports wagering, but this deal does not cover either state.
“As an American myself, I’m thrilled to bring our world-leading technology to Indiana and Colorado, as well as more states across the country,” Smarkets CEO and founder Jason Trost, said. “I truly believe that an agile company like ours can make a huge impact against some of the bigger players thanks to our superior technology and focus on providing the best prices.”
Indiana sports betting went live this week, but Smarkets won’t be going live right away. It’s said that its SBK sports betting app in Indiana will be available for later this year.
A US betting exchange?
Smarkets says it has processed over $15 billion in transactions across regulated markets, but a lot of that money has flowed through the betting exchange that is the company’s bread and butter.
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That concept could be a bit foreign to a US bettor but will be familiar to punters in the UK and beyond. Instead of betting against the house, a betting exchange allows bettors to wager against one another on an open market. A bettor offers odds they want on a certain game or outcome, and others may take that bet.
The exchange, like Smarkets, usually takes a small commission on winning bets as its business model.
Some in the US are high on the prospects of sports betting exchanges moving forward. But we have yet to see one deployed; the most famous one, Betfair, has not yet gone live in any US market. (Betfair is part of Paddy Power Betfair, which also operates FanDuel Sportsbook in the US.)
The problem with exchanges in the US is that they would have to be ring-fenced by state. If you’re in Indiana, you would only be betting against other Indiana bettors, for instance. Finding the critical mass to make an exchange work will be difficult in smaller states like Indiana and Colorado. It would be easier should bigger states like California and New York open up to online betting.
In any event, Smarkets would like to bring its betting exchange to the US, and this is likely the first step toward accomplishing that goal.
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