nlike traditional "tote" wagering, where the odds fluctuate, are not determined until the start of each race and are the same for each customer, exchange wagering utilizes cutting-edge technology to allow players to take fixed odds by proposing or matching anonymous trades with each other via the exchange platform.
According to Betfair's consumer research, exchange customers are generally much younger and more tech-savvy than the demographic profile of horse racing fans in the US
It also allows bettors to ask for better odds than those available in the market at that time, to continue to wager during the running of a race and to "Cash Out" before a race is complete to ensure a profit or mitigate a potential loss.
Exchange wagering is very popular in other countries, including in the UK, where Betfair pioneered the exchange 15 years ago. Betfair now processes on average more than three million transactions each day.
"We are excited to be launching exchange wagering in New Jersey with our local horseracing stakeholders," said Kip Levin, CEO of Betfair US. "Our experience in the UK and other markets has proven that exchange wagering is an attractive prospect for consumers and that it can bring new customers, increased engagement and new revenue to horse racing."
"We need to embrace technology for horse racing to attract new participants, new customers and new revenue streams and we are confident that exchange wagering can help us do that," said Dennis Drazin, the president of Darby Development, which manages Monmouth Park Racetrack. "We think this can be a net positive for our industry and that it can complement traditional wagering."
According to Betfair's consumer research, exchange customers are generally much younger and more tech-savvy than the demographic profile of horse racing fans in the US.
Exchange wagering was first authorized for the state's residents by the New Jersey Legislature in 2011. Betfair was licensed by the state to conduct exchange wagering in November of 2015 as a service provider to the NJSEA (New Jersey Sports and Exposition Authority) and Darby Development, the exchange wagering manager.
Betfair, which owns the Los Angeles-based horse racing television network and advance deposit wagering platform TVG, also operates 4NJ-BETS and Betfair Casino in New Jersey.
Monmouth Park, which begins its popular summer racing season on May 14, will highlight the tracks offered to players on the exchange. Betfair launched a closed beta version of its platform available to its 4NJ-BETS customers on April 18.
Betfair has developed a simulator for U.S. audiences to experience the exchange.