Flutter to close NJ Betfair racing exchange
FanDuel Group COO Kip Levin says product will be pulled in October after not “hitting critical mass”
Flutter is closing its New Jersey racing exchange in October after four years of operating the only betting exchange product in the state.
According to Thoroughbred Daily News, the operator was never able to secure the rights to take bets from major US racetracks, including those belonging to Churchill Downs and The Stronach Group.
FanDuel Group COO Kip Levin told the news outlet the Betfair exchange “never hit the critical mass needed for it to be viable.”
Betfair’s NJ offering was also unable to offer bettors the 5% commission rate common in the UK, instead settling on 12% commission so it could afford to pay US tracks and support horsemen’s groups.
The Wire Act’s limitation on shared liquidity and being unable to expand outside NJ provided big barriers for the product.
FanDuel’s Levin said: “When we launched in 2016, we felt like exchange wagering, popular elsewhere, was worth trying in New Jersey to see if it could increase new fan interest in racing.
“For a variety of reasons, including a customer base used to exotic wagers and a reluctance by major US racing associations to embrace the different business model, it never hit the critical mass needed for it to be viable,” he added.
Back in 2016, William Hill US CEO Joe Asher told EGR the exchange model would only appeal to a niche market in the US.
Elsewhere, New Jersey’s first sports betting exchange Sporttrade is awaiting licensing to operate in the state after securing a market-access deal with Twin River.