The first betting exchange was set up by Betfair in June 2000. They do not accept bets per se but instead match backers with layers while taking a commission (5%) on the winning bets.
Backers- The same as placing a bet at a regular bookie. Simply, backing an outcome you think will occur.
Layers- Simply, betting on a selection to lose or not occur. A bookie would usually “lay” your bet so you are pretty much acting as the bookmaker.
For example, if someone thinks Man City will win the Premier League, they may back that selection. A bookie offering this bet would be laying (betting against) this outcome.
On a betting exchange, you can either back Man City or lay against them. If Man City win, the backer wins depending on the stake and odds agreed. If Man City do not win, the layer wins the backer’s stake.
With exchanges, you only need to find another member willing to take a risk on the odds (lay your bet) for it to work. Every bet placed requires a backer and a layer.
Exchanges display odds in decimal format, check our odds guide for further information.
What are the differences between a betting exchange and a bookmaker and which one is better? Well, both have there pros and cons depending on your betting style and overall goal.
Overall, it completely depends on your needs as a punter. As a casual gambler, you may enjoy placing multiples or betting on obscure markets, making bookmakers perfect for you.
If you gamble with high stakes on the popular markets and worry about account limitations, betting exchanges are perfect for you.
If you are unsure or lie somewhere in between. Give them both a try and work out what’s best for you. There is no right or wrong, just merely preference.
Steven is an experienced iGaming content writer who has been working in the industry since 2018. He is passionate about sports betting and enjoys writing about all aspects of the industry, including bookmaker reviews, betting tips and strategies, and news and analysis. If you have any questions about online gambling in the UK, please don't hesitate to contact him.