The latter commission announced yesterday a set of measures designed to “help the market operate openly, fairly and efficiently to benefit investors and promote capital formation”. This is in response to concerns about high-speed trading that have been to the fore in recent weeks with the publication of Michael Lewis’s “Flash Boys”.
In the zero-sum world of sports trading, unfortunately not everyone will be an investor 'promoting their capital formation' (which is fancy a way of saying 'making money' as I think I have seen), but the first part about operating openly, fairly and efficiently is pertinent.
One proposal “is a rule that would require high-frequency traders to register with regulators as broker dealers” – in our world, Betfair already know the court-sider driven accounts, and any new ones would be easily identifiable.
The problem is that rather than make changes to ensure the markets operate fairly, Betfair have so far chosen to allow the practice to continue while making sure to take a huge cut of the profits themselves. This is a very short-sighted strategy in my opinion, an approach that not only risks intervention from the Gambling Commission (motto: keeping gambling fair and safe for all) as they act to protect the unaware, the unintelligent or the unwise, but also resulting in an inevitable decline in liquidity.
I understand that new money will always be coming in to the markets where court-siders are operating, but even the most optimistic of gamblers will at some point realise that the odds are literally against them, and that they are throwing their money away. When you are watching an event and ‘seeing’ what happened on the exchanges long (i.e. more than the delay) before the action unfolds on your TV, why would any sane person get involved? Bet before the game if you identify value, turn the computer off and enjoy the sporting spectacle or go to bed, get some sleep, and check on your capital formation in the morning.
As more and more is written about the practice, (and I await the arrival of “Game, Set and Ca$h” with less anticipation than previously, after reading reviews that it is basically crap – a diary of “woke up with a hangover, avoided security, pressed a few buttons, went out and got hammered” and repeat), fewer and fewer people are going to involve themselves with in-running betting, which would be a shame because the founding fathers Bert and Eddie’s original idea of individuals pitting their wits against each other was a great one.
What they didn’t intend, hence the n-second delay on new bets, was that the markets would come to be owned by an elite group of individuals benefiting, not from their sharp minds, but from the pressing of a button, or perhaps the twisting of a knob, sewn into someone’s underpants. When you think about it, it's perhaps not surprising that Daniel Dobson was arrested - the surprise being in the nature of the charges that were filed against him.
It is of course quite understandable that operatives have taken advantage of the opportunity that the current configuration has allowed, but as I have said before, it is very strange that Betfair have not closed the loophole.
Some of you may recall the ‘beat the clock’ loophole that a real sharp mind came up with a few years ago. What used to happen was that a bet would be entered, the clock would countdown, and then be placed after ensuring (after the delay had elapsed) that the funds were available. At least one enterprising individual took advantage of this design flaw, by tying up most of the funds in his account on an unmatched, and unmatchable, bet – something like Brazil to win the World Cup at 1000-1.
What they didn’t intend, hence the n-second delay on new bets, was that the markets would come to be owned by an elite group of individuals benefiting, not from their sharp minds, but from the pressing of a button, or perhaps the twisting of a knob, sewn into someone’s underpants. When you think about it, it's perhaps not surprising that Daniel Dobson was arrested - the surprise being in the nature of the charges that were filed against him.
It is of course quite understandable that operatives have taken advantage of the opportunity that the current configuration has allowed, but as I have said before, it is very strange that Betfair have not closed the loophole.
Some of you may recall the ‘beat the clock’ loophole that a real sharp mind came up with a few years ago. What used to happen was that a bet would be entered, the clock would countdown, and then be placed after ensuring (after the delay had elapsed) that the funds were available. At least one enterprising individual took advantage of this design flaw, by tying up most of the funds in his account on an unmatched, and unmatchable, bet – something like Brazil to win the World Cup at 1000-1.
I believe his sport of choice was cricket, but the principle is the same whatever it was. He would then enter a bet as the bowler ran up, which he would want to be matched only if a wicket fell. If the wicket didn’t fall, then the bet would be rejected by the system due to “Insufficient Funds”, but on occasions when the wicket did fall, he would immediately cancel his bet on Brazil, freeing up his funds, as his cricket bet hit zero, and that bet would then be matched (effectively) instantaneously.
Once that loophole was revealed, Betfair acted fast to perform their ‘credit check’ up front. Why they didn’t leave it open and charge him, and any others using the same strategy, up to 60%, I’m not sure.
Once that loophole was revealed, Betfair acted fast to perform their ‘credit check’ up front. Why they didn’t leave it open and charge him, and any others using the same strategy, up to 60%, I’m not sure.
Perhaps he wasn’t a former employee?
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