An East Coast-based tech firm that plans to offer a betting exchange in which customers trade sports bets as if they were stocks is preparing to offer its programming in Indiana next year through a deal with Caesars Entertainment.
Sporttrade Inc., a Philadelphia-based company, is awaiting regulatory approval to begin operating in Indiana, which the company hopes to receive by the end of 2022. The exchange would be the first of its kind in Indiana.
The firm raised about $36 million in funding in 2021, with several hedge funds and institutional investors signing on to back its growth. Sporttrade plans to launch in New Jersey in mid-2022 with Colorado expected to join by the end of the year.
As part of its announcement about Indiana, Sporttrade said it is also expanding in Louisiana through a deal with Penn National.
“We are incredibly humbled to be partnering with two of the most recognized gaming leaders to bring our differentiated sports trading platform to customers in Louisiana and Indiana,” Sporttrade CEO Alex Kane said in written remarks.
He added the market partners “believe in our vision of elevating the sports betting industry and see the opportunity to make sports betting more akin to capital markets and tap into growth of retail stock and crypto traders, as well as attracting traditional sports bettors.”
Sporttrade will take its sports betting exchange platform live with backing from Caesars. It will operate much like a stock market, with bets on the company’s exchange set by market makers—individuals who determine the value of a bet. Specifically, the market makers will set bid prices for sellers and ask prices for buyers.
The firm takes a small commission on each trade, but plans to keep costs low by minimizing margins on bets.
Since legal sports betting launched in Indiana in September 2019, bettors have wagered more than $6.5 billion. But Sporttrade’s hopes to attract customers beyond the typical sports bettor, including day traders and stock speculators.