Betfair celebrates as New Jersey issues America’s first exchange wagering license

new-jersey-racing-commission-exchange-wagering-betfairNew Jersey has become the first US state to issue an exchange wagering license, ending a long and often frustrating journey for the US division of UK-listed betting exchange Betfair.

On Wednesday, the New Jersey Racing Commission held its latest executive session, at which it formally approved an application by the New Jersey Sports & Exposition Authority (NJSEA) for the issuance of a exchange services agent license to Betfair US and an exchange management agent license to Darby Development.

Darby is the Dennis Drazin-led company that operates the Monmouth Park Racetrack on behalf of the NJSEA. Betfair already handles Monmouth’s advance deposit wagering site and the two parties struck an exchange wagering deal two years ago. New Jersey passed its Exchange Wagering Act in 2011 but took a long time approving the necessary regulations.

The license approval means Monmouth could handle its first exchange wager as early as March 2016. That happy day will mark the culmination of a long and expensive journey for Betfair US, which spent $10m in an unsuccessful bid to get industry stakeholders in California to get over their fear of exchange wagering.

Meanwhile, New Jersey’s top gambling regulator has made no bones about the fact that he wants to see the state’s racetracks and casinos offering real-money sports bets in both land-based sportsbooks and via online betting sites.

The state is awaiting its rehearing with the US Third Circuit Court of Appeals of its bid to overturn the federal ban on sports betting and, should that decision go New Jersey’s way, Division of Gaming Enforcement director David Rebuck says the state would immediately take steps to enable online wagering.

Rebuck told Gambling Insider that, while a victory at the Third Circuit was far from assured, the fact that the Court agreed to rehear the state’s case “is probably the first time that we had a small victory in our efforts to date.” Should the state emerge victorious, the next step would be to “change the sports wagering prohibition to allow for sports wagering to be performed on the internet.”

Rebuck said the current hubbub surrounding daily fantasy sports wouldn’t distract the state from its pursuit of real-money sports betting. “That’s the one we’re focused on. If we lose that again, and we’ll know soon, because the hearing could probably be in the next 90 days, then we’ll adapt and see what’s next on our horizon.”

Speaking of brave new betting worlds, Thursday saw the Nevada Gaming Commission formally approve regulations to allow so-called ‘entity betting’ in the state. SB 443, which was strongly supported by sportsbook management firm CG Technology, was signed into law by Nevada Gov. Brian Sandoval this June, paving the way for Nevada-licensed sportsbooks to accept wagers from Nevada-registered business entities.

SB 443 was controversial given its provision for allowing indirect participation by out-of-state residents. These residents would deposit money with registered sports betting investment funds, which would act like mutual funds, placing wagers on their members’ behalf without allowing them direct input into wagering decisions.