Smarkets's skullduggery

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PolicemanPrawn
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Location: Extremistan

I've started to use Smarkets more, and there are a lot of benefits but they also do all kinds of skullduggery to combat customers.

It seems much of it stems from their use of market-makers who either work for Smarkets or work on their behalf who provide (artificial) liquidity to the exchange. So that when you are betting there, chances are you aren't betting with other customers but with Smarkets themselves. This of course creates a conflict of interest between the exchange and their customers, because you are betting directly against the exchange.

I've only been using them a short while but already I've witnessed their tricks, just because I have the audacity to win off them. Some of the tricks they do include:
(1) They use their liquidity providers to mimic Betfair prices. So you're not betting with other customers but with the exchange directly, which is a similar situation as with a regular bookmaker. Sometimes you can bust their risk limits, and you get the ridiculous and pathetic situation of what appears to be a liquid market with loads of participants turning into an empty market with about 5 orders. A high proportion of their revenue now comes from proprietary trading and I know they're recruited a lot of people into that area.
(2) They can implement 'in-play delays' for pre-match markets. I've had in-play delays for events that weren't taking place until weeks later.
(3) They show prices when logged out that aren't available when logged in. I know Betfair do this to stop people stealing their prices, but Smarkets do it different in that they show prices when logged off that are not available when logged in, whereas Betfair do it the other way round. Why is that the case? I suspect they are developing facilities whereby they can offer different prices to different users.
(4) They can simply throttle you and stop you placing trades. This happened to me, after a number of trades, and I couldn't place trades on that market anymore; a message came up saying "throttling exceeded".
(5) Smarkets are opaque about the stuff they're doing. They don't admit to doing any of this, and they are prominent on Twitter denying they ban customers, which is misleading because few bookmakers literally ban customers; they just restrict them so low as to be a ban in all but name.

It's a pity they're doing this, as I had high hopes for them as a Betfair Premium Charge refugee, but in many ways they are worse than Betfair.

Let me know what your experience of Smarkets is and if you've experienced the stuff above. I've only used them briefly, so I'm sure they have other tricks up their sleeve.
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Dallas
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Your comments echo many others on this thread below which might be worth a read, there are also a few replies from Jason (their CEO)
viewtopic.php?f=2&t=15419
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LeTiss
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That sounds pretty horrendous.

As Dallas mentioned, Smarkets have received bad press here, but Jason Trost came here to defend the company
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Derek27
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Welcome to the forum PolicemanPrawn, and thanks for sharing your experiences on Smarkets. I hope Jason sees your post and responds with an explanation.
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ANGELS15
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This backs up a lot of negative reviews I've read. typically they seem to close accounts if people win too often which now figures if they're using their own money to lay. also one trader said they complained because he 'greened up' too often! Avoid.
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SeaHorseRacing
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No disrespect to Jason.. he’s a businessman who has just jumped on the bandwagon of an exchange anyone with two brain cells, investment and the drive could create an exchange. They offer absolute nothing different to betfair neither do betdaq or matchbook.

There just trying to make a buck competeting against betfair.

I have 0 desire to use sneakers (smarkets real name) and I think 99% of others feel the same. You simply cannot compete with betfair if you don’t have the “genuine” liguidity there.

If you just betting £50 ofcourse take the smaller commission on these sites.

If they want traders maybe they should invest in doing so.

If Smarkets became the number 1 betting exchange which exceeded Betfair.. my question would be... would smarkets open a casino and a sport book. You bet your ass they would!
JTEDL
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....and now most of us 'mere mortals' can get 2% commission at Befair / Betdaq at the moment, so why use Smarkets? They'll lose some matched betting customers also I reckon.
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northbound
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There’s a good probability all these exchanges / bookies that employ a bean counting, winners unwelcome approach, will be washed away within 5-10 years IF blockchain betting platforms reach a decent level of user friendliness.

Very very early days, but there are already some working examples, like Wagerr. Currently you can bet on a few selected sports, with an overround of only 2%, using the WGR token.

https://www.youtube.com/watch?v=oQVRkXnVB_E

Completely decentralised platform. They are also working on a decentralised betting exchange.

If you buy enough tokens, you can connect your own node to the network, partaking in a share of the commissions.
vide0star
Posts: 50
Joined: Thu Jul 07, 2011 8:19 pm
Location: London

I had to look up 'skullduggery' to make sure I knew what I meant. I will try my best to use it in a sentence the rest of the week!


PolicemanPrawn wrote:
Sun Oct 07, 2018 7:29 pm
I've started to use Smarkets more, and there are a lot of benefits
Cool!
but they also do all kinds of skullduggery to combat customers.
Not cool!
It seems much of it stems from their use of market-makers who either work for Smarkets or work on their behalf who provide (artificial) liquidity to the exchange. So that when you are betting there, chances are you aren't betting with other customers but with Smarkets themselves. This of course creates a conflict of interest between the exchange and their customers, because you are betting directly against the exchange.
Hanson, our sister company that does market making, accounts for roughly 30% of the volume on Smarkets. While a big customer, it's by no means the only one. There are plenty of p2p trades as well as p2hanson trades. Hanson has no order routing priority.

Also, none of the liquidity is 'artificial' (I'm actually not sure what artificial liquidity means). The bets are backed up by real money. Hanson operates as a customer of the exchange with its own balance like other customers. Furthermore, I believe Hanson is the largest sports market maker in the world. It trades on other exchanges. It's an important part of any exchange echo system to have market makers.
I've only been using them a short while but already I've witnessed their tricks, just because I have the audacity to win off them. Some of the tricks they do include:
We have no issues with audacity
(1) They use their liquidity providers to mimic Betfair prices. So you're not betting with other customers but with the exchange directly, which is a similar situation as with a regular bookmaker. Sometimes you can bust their risk limits, and you get the ridiculous and pathetic situation of what appears to be a liquid market with loads of participants turning into an empty market with about 5 orders. A high proportion of their revenue now comes from proprietary trading and I know they're recruited a lot of people into that area.
We don't mimic anything. BF liquidity is an important part of the global ecosytem and it's only natural that the markets will be related. We are also linked to other sources of liquidity and may or may not have the same prices as them.
(2) They can implement 'in-play delays' for pre-match markets. I've had in-play delays for events that weren't taking place until weeks later.
No we don't. If there was an in play delay pre match it might have been from a one off error with our sports data.

(3) They show prices when logged out that aren't available when logged in. I know Betfair do this to stop people stealing their prices, but Smarkets do it different in that they show prices when logged off that are not available when logged in, whereas Betfair do it the other way round. Why is that the case? I suspect they are developing facilities whereby they can offer different prices to different users.
If you have discovered it, it's a bug. please let support know and we'll fix it.
(4) They can simply throttle you and stop you placing trades. This happened to me, after a number of trades, and I couldn't place trades on that market anymore; a message came up saying "throttling exceeded".
We will throttle you if we you're scraping the site or hitting it too fast. We won't stop you from betting.
(5) Smarkets are opaque about the stuff they're doing. They don't admit to doing any of this, and they are prominent on Twitter denying they ban customers, which is misleading because few bookmakers literally ban customers; they just restrict them so low as to be a ban in all but name.
I think we're quite the opposite of opaque. All you have to do is ask!
It's a pity they're doing this, as I had high hopes for them as a Betfair Premium Charge refugee, but in many ways they are worse than Betfair.

Let me know what your experience of Smarkets is and if you've experienced the stuff above. I've only used them briefly, so I'm sure they have other tricks up their sleeve.
I hoped I helped clear up some of the alleged skullduggery. There, I was able to use it already :-)
vide0star
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Joined: Thu Jul 07, 2011 8:19 pm
Location: London

ANGELS15 wrote:
Mon Oct 08, 2018 11:23 am
This backs up a lot of negative reviews I've read. typically they seem to close accounts if people win too often which now figures if they're using their own money to lay. also one trader said they complained because he 'greened up' too often! Avoid.
We have never, not once, never closed a customer's account for winning.
vide0star
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Joined: Thu Jul 07, 2011 8:19 pm
Location: London

I love the positive feedback guys. I'm really happy we're able to be giving the market more choice, which keeps the competition honest.

Joking aside, I am here to help. I know forums are easy places for people to log on and complain. I think only one person on this forum has been in touch with me to ask me a question in the last 12 months. If you think Smarkets is up to no good, you can always start by speaking with our support or emailing me (jason at smarkets do com) or sending me a DM on this forum.

There are no issues with posting your qualms or feedback on a public forum of course, but I'd suggest trying to find some more answers before going broad with a complaint.

Lastly, I do appreciate Euler letting me post on here. I know most of you aren't customers. I'm not here to advertise my business. I'm here to advocate for exchanges and be a resource to you guys to give you answers from the operational side. Running an exchange is hard and complicated and a lot of the nuance won't be obvious unless you speak to somebody on my side.
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SeaHorseRacing
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vide0star wrote:
Mon Oct 08, 2018 8:10 pm
I love the positive feedback guys. I'm really happy we're able to be giving the market more choice, which keeps the competition honest.

Joking aside, I am here to help. I know forums are easy places for people to log on and complain. I think only one person on this forum has been in touch with me to ask me a question in the last 12 months. If you think Smarkets is up to no good, you can always start by speaking with our support or emailing me (jason at smarkets do com) or sending me a DM on this forum.

There are no issues with posting your qualms or feedback on a public forum of course, but I'd suggest trying to find some more answers before going broad with a complaint.

Lastly, I do appreciate Euler letting me post on here. I know most of you aren't customers. I'm not here to advertise my business. I'm here to advocate for exchanges and be a resource to you guys to give you answers from the operational side. Running an exchange is hard and complicated and a lot of the nuance won't be obvious unless you speak to somebody on my side.
Firstly. Nothing but respect that you are personally responding to messages.

What I can’t seem to understand is how betdaq,smarkets and the like are unable to compete any where near to the levels of betfair. Betfair was created on a great innovation nearly 20 years ago. How has that company that charges pretty much 40% to high earners in premium charge able to control such a big chunk of the market without competition even coming close.

I know foreign legislation is an issue at that they are trading in different countries to you, but i still and have done for a long time scratched my head as to why you haven’t become serious competitors?

I don’t mean this disrespectfully but just a direct question. I know it’s not that straightforward... but why?

Are you in the business to pick up the missed nuggets or are you serious about being an exchange?
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northbound
Posts: 737
Joined: Mon Mar 20, 2017 11:22 pm

Also, it seems that Smarkets have been around for 5+ years now. Why haven’t you launched an easy / open to all API long ago?

I recall you had one which was for selected market makers only. That alone makes me suspicious.

This goes for those sad people at Betdaq as well btw. I asked for access and they told me I need to fund my account with £200 to get access.

Which is not a problem, but ffs platforms that thrive on liquidity MUST welcome any interest with open arms. Not put stupid barriers to entry.

Crypto exchanges have free, open to all APIs. You open an account and 1min later you can play with your programming language of choice and interact with the exchange. Simple.

Betting exchanges such as yours have lots to learn from that approach.
vide0star
Posts: 50
Joined: Thu Jul 07, 2011 8:19 pm
Location: London

SeaHorseRacing wrote:
Mon Oct 08, 2018 9:07 pm
Firstly. Nothing but respect that you are personally responding to messages.

What I can’t seem to understand is how betdaq,smarkets and the like are unable to compete any where near to the levels of betfair. Betfair was created on a great innovation nearly 20 years ago. How has that company that charges pretty much 40% to high earners in premium charge able to control such a big chunk of the market without competition even coming close.

I know foreign legislation is an issue at that they are trading in different countries to you, but i still and have done for a long time scratched my head as to why you haven’t become serious competitors?

I don’t mean this disrespectfully but just a direct question. I know it’s not that straightforward... but why?

Are you in the business to pick up the missed nuggets or are you serious about being an exchange?
This is actually a smart question, so no worries about asking it. I am 100% serious about an exchange. I'm a tech geek. I'm actually not that passionate about sports betting at all. I'm passionate about making event trading an asset class, sports certainly being an important event that people trade.

While we're not at BF scale yet, I think we have about 15% the exchange market share, which I don't think is all too shabby considering where we came from. We certainly are not satisfied with only 15% market share.

There are two reason's it's hard to compete:

1) it takes a long time to build an exchange tech stack
2) it takes a long time to unwind network effects

We raised £3.5m investment over the first 7 years of Smarkets's life. It's not a lot of money when competing against BF (They raised $50m or so), and it simply has taken us a long time to get a tech stack that can be at par, and in some cases, more advanced than BF. I'm happy to say, we're close to surpassing BF from a technical perspective in most aspects. I wouldn't have said that two years ago.

Secondly, lots of people are used to using them, they have many avenues to capture liquidity in far off places in the world, and their API is widely used. Exchanges become more valuable as more people use them. It's possible to move customers to a new exchange, but it takes time. If it does happen, it usually goes very slowly at first, then as adoption hits critical mass, it goes faster. I think we're close to this inflection point but it's hard to predict.
PolicemanPrawn
Posts: 7
Joined: Fri Aug 15, 2014 2:01 am
Location: Extremistan

I assume vide0star works for Smarkets. Can I ask who you are? It might be good that they're replied, but I don't believe they're doing it with good and honest intentions. I don't find their response humourous at all.

By artificial, I mean from non-customers; ie from the exchange and their partners. Artificial might not be the best word but the meaning is pretty clear.

Having market-makers on an exchange is fine. I'm a 'market-maker' on quite a few exchanges. The problem is when the market-maker is a partner company of the exchange itself or working on their behalf, as is the case with Smarkets. It creates a conflict of interest because customers are winning directly from Smarkets (or their partners), which presumably is not something Smarkets wants, and in most cases when this arises, there is an incentive and actual actions to hinder these winning customers. Look at the softbooks. Even Asian bookmakers have minute limits for many of their markets, and may even restrict themselves. Why would Smarkets be any different? Your reply very disingenuously ignores this key part about the market-maker being in business with the exchange itself, as opposed to being an entirely separate and independent entity.

(1) You say "We don't mimic anything", but this appears to be a falsehood. It's pretty clear that Smarkets's market-makers mirror Betfair prices quite a lot. (It is, in fact, one of the appeals of Smarkets.) This is obvious to anyone who has used them briefly. What is your policy when it comes to winning customers and the market-makers? By default, when it comes to orders provided by the employed market-makers, orders on a price that gets cleared out get replenished (iceberg orders, they are called), so that you can keep on hitting and lifting: will they change this for certain customers? More generally, are there plans to treat winning customers differently to losing customers?

(2) What happened was I was betting on an event that wasn't due to start until weeks later. After a few bets, suddenly I had an 'in-play' delay of about 8 seconds, and future bets on that market were subject to this in-play delay. You claim that it is an error, but how can such an error even come about in the first place? Perhaps you are correct about it merely being an error, but I doubt it.

(3) Another claim of an error. What is your policy on showing prices when logged in vs when logged out? Are they the same? Do you show less prices when logged out than logged in? Do you show prices when logged off that are unavailable when logged in (this is the case right this very moment with at least one market)? Is this explained by Smarkets on their website?

(4) So you have admitted that you do stop customers from placing bets (under certain conditions). What is your policy on "throttling" bets? Where in your terms and conditions is this explained, whereby customers cannot trade temporarily if they have traded too much? When this happened to me I couldn't trade on that market for about ten minutes.

(5) I'm not sure why you think asking Smarkets about their problems is a better idea than posting on a neutral forum, but I think it's because you don't want your skullduggery to become public. I find your reply pretty dishonest and evasive. I think you are used to being able to BS people, but be warned that that doesn't work on me, and I'm pretty tenacious when it comes to seeking out the truth.

I will continue using Smarkets because it will be a profitable enterprise. But from now on, I'll be very closely watching them for any signs of skullduggery, and collecting evidence in the form of screenshots and videos, which I may make public once I've gathered enough evidence.
Last edited by PolicemanPrawn on Tue Oct 09, 2018 5:17 pm, edited 1 time in total.
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