Sporttrade is the first sports trading platform in the United States.
New Jersey bettors can trade sports wagers in real time like contracts, using financial trading strategies rather than hacks to try to beat oddsmakers. Sporttrade’s unique live betting capabilities also offer the potential for a sports prediction and analysis tool.
Sporttrade is unique from traditional sportsbooks and betting exchanges. Traditional sportsbooks have oddsmakers who set odds. On betting exchanges, bettors set their own odds and accept wagers from other users. This gives bettors a range of odds to choose from, but each set of odds has a set wager limit. So, the amount a bettor can bet — and win — depends in part on all of the other bettors wagering on a specific bet.
On Sporttrade, bettors trade wagers priced from $0 to $99 per contract. Winning bets get paid $100 and losing bets are paid nothing. With this pricing model, Sporttrade isn’t concerned about being on the winning side of a bet. It just needs enough users to satisfy bets (Sporttrade has partnered with large companies that buy and sell contracts to ensure customers can make their early trades.)
Sporttrade has this research potential because its trade price equals the probability of a bet winning. Its real-time bettor responses and high uptime lend the platform to research for sports prediction and analysis. It also doesn’t rely on products that traditional sportsbooks and exchanges need to improve their live betting offerings.
Micro-Betting and Live Betting
Every national sportsbook brand offers live betting. The odds will change in real-time as the outcomes of different wagers change in-game. At traditional sportsbooks, there’s often downtime where bets are locked as odds are recalculated. This interrupts the live betting experience.
To keep bettors engaged in-game, gambling startups are introducing micro-betting. Micro-betting involves wagering on how the next play will turn out or how certain players will perform. Even though these bets settle in minutes or seconds, bettors have to pay attention to ever-changing wagers.
“If you’re trying to do micro-betting, you are forced to engage every few seconds,” Sporttrade Founder and CEO, Alex Kane, said. “I think when it’s entertainment, you have to afford the customer the most flexibility possible. So it’d be like when you went to a movie, but you couldn’t dose off or really enjoy it because every minute you had to decide what was going to happen next.”
Sporttrade users can already bet based on how a particular play goes. If the Broncos botch a play, there’s nothing stopping a Sporttrade user from selling off their Broncos contracts or buying into the opposing team. Since users are fluidly responding to the game in real-time, Sporttrade doesn’t need to prompt its bettors with micro bets.
In contrast, traditional sportsbooks need micro-betting to build on their live in-game betting offerings. Traditional sports betting requires downtime for recalculation. Micro-betting is a way to improve in-game engagement while recalculation speeds slowly improve.
“I think there’ll be a place for it [micro betting], one hundred percent,” Kane said. “But I think it’s likely going to be for the type of bettor who’s … watching every game … and even then it’s going to be probably tiring for that customer.”
Sporttrade’s Potential as a Sports Prediction and Analysis Tool
Sporttrade’s hyper-liquid markets make it an ideal tool for tracking bettor reactions in real-time. There are enough trades and tight enough prices that small changes in bettor opinion translate to contract price changes.
“You could have a tight enough market that you actually see a delta [change] of next chance to win their division based on what they’ve decided to do … or not,” Kane said. “Whether the market agrees or disagrees with the decision of one representative … for the front office of an organization.
There’s definitely value there, [but] that’s more on the research side.”
Tracking which events cause price changes reveals how teams perform relative to fan expectations. Prediction markets aren’t the only data source that teams can pull from. However, their potential as research tools is an object of study across subjects from finance to politics. Sporttrade is an ideal platform to study as a prediction market for sports.
“I think that coaching decisions and things [like that] could be very interesting, especially around end of half and end of game [decisions] of whether to go for it,” Kane said.
Sustained study of Sporttrade’s market data could reveal new insights that researchers, organizations, and sports analysts could use to better predict game outcomes and analyze team strengths and weaknesses.
Sporttrade also boasts a wealth of insights about when bettors are most engaged with the games. Obviously, interest spikes during play and drops between plays. However, detailed analysis of bettor activity could find gradients in bettor interest, informing sports broadcasts or in-game entertainment.
The Future of Sports Trading
While Sporttrade didn’t design itself as a prediction market, it’s suited to be studied like one. Data agreements could form a future revenue stream that supplements the low-margin revenue Sporttrade makes from commissions on winning bets. Sporttrade’s ability to develop these data agreements will strengthen after it launches futures markets and generates data on season-long confidence in a team.
Sporttrade’s potential in sports is based on its unique trading capabilities and price structure. A glance at prices can reveal a bet’s probability. The tight prices ensure that small changes in bettor sentiment are picked up in a contract’s new price.
Unlike other prediction markets, Sporttrade is an entertainment product first. Political prediction markets, PredictIt and Iowa Electronic Markets, are built as academic research tools. Event contract exchange, Kalshi, provides financial hedging tools that farmers have used for about a century.
Financial exchanges of all types rely to some extent on speculators. Speculators are users who treat them like gambling platforms and who pump most of the money into those markets. The users who use Kalshi for legitimate hedging purposes owe their reliable payouts partly to speculators.
Since Sporttrade is a gambling platform, it doesn’t face the same difficult questions about balancing gambling speculators against hedging risk or conducting research. If the trading app can launch successfully in multiple states with legal sports betting, Sporttrade could also emerge as a formidable data provider for sports predictions and the research behind them.
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