Betfair Approved for Betting Exchange License in New Jersey

Betfair broke new ground by being the first company licensed to offer its betting exchange services in the U.S. when the New Jersey Racing Commission gave its approval.

The UK-based gaming operator, who has already established a presence in New Jersey and offers online casino gambling through its partnership with the Golden Nugget Casino in Atlantic City, rolled out its betting exchange concept in 1999. It allows gamblers to offer their own odds under a peer-to-peer wagering format, and if a taker is willing to match the bet, the wager is booked.

The concept may be somewhat foreign to U.S. gamblers, who typically have to accept odds as set by bookmakers. But New Jersey gamblers who play the ponies will soon be introduced to the betting exchange format, which customarily allows for the odds offered to be a bit better than those fixed by bookmakers.

4-Year Wait

Betfair applied for the license in New Jersey four years ago, hoping to extend exchange betting to sporting contests after Garden State voters had approved legalized sports betting at racetracks and casinos via a referendum. Gov. Chris Christie then signed a bill into law to that effect, but legal maneuvering at the federal level by leagues of major sports put the whammy on New Jersey's sports betting plan.

The DoJ also came out with its ruling in 2011 that clarified the 1961 Wire Act, finding that online sports betting was a definite no-no. That decision did allow states to pursue online poker and gambling legislation, which three have done thus far including New Jersey.

Betfair has joined forces with Monmouth Park Racetrack and will launch exchange betting to New Jersey residents perhaps as early as March of next year. It will be restricted to horse racing, unless New Jersey can eventually win its appeal on the sports betting decision.