Betting Exchanges in Canada: Complete Guide & Top Platforms in 2024

In traditional sports betting, you are placing a wager against odds set by the sportsbook. Betting exchanges allow you to create your own wager with your own odds and other users can bet against you, essentially acting as the sportsbook. This gives you the freedom to wager on any event you want, even those with unfavorable odds on standard betting sites. It also gives you the opportunity to profit on poor wagers that other users place. 

This concept may still not be one hundred percent clear to you, so let’s break things down even further. Betting exchange websites provide no odds themselves. Every wager you see advertised on their website is something that another user has posted, and you have the opportunity to post wagers yourself at whatever price and odds you choose.

For example, I could place a $100 wager on the Bills moneyline next week at +120 odds. If someone wishes to accept my action, they will win my $100 if the Bills lose. If the Bills win, I receive my $100 back and win $120 from the user who accepted my action.

Most betting exchange websites will take a small percentage of the winnings, but the percentage they take is much smaller than the percentage that traditional betting sites take. Betting exchange sites normally take around 3-5% of the winnings, whereas traditional betting sites take around 5-10%. These sites do not provide you with the true odds on any event you wish to bet on, instead they make them slightly less favourable to ensure themselves a profit in the long run regardless of the outcomes. This is why you might commonly hear the term “fixed odds,” when discussing a bet, the odds are always fixed in the sportsbooks favour.

Now that you understand the concept of betting exchanges, let’s go over how to place a wager. The first thing you need to understand is how to use a sports betting exchange website. Here is a step-by-step guide:

1. Create an account.
2. Browse the website and find your preferred market.
3. Either post a wager at your preferred odds (Back) for someone else to accept or accept someone else’s wager at the odds and price they posted (Lay).
4. If you chose the “Back” option then you need to wait for someone to accept your action in order to receive a potential payout. 
5. If you chose the “Lay” option then you just need to wait for the outcome that you bet against. If you are correct, then you will receive a payout but if you are incorrect your stake will be sent the other user. 

Navigating the betting exchange market is similar to navigating regular sportsbook markets, but the key difference is the odds and prices you are viewing have been posted by other users just like yourself. You can sort the market first by sport and then by individual matches or futures such as Superbowl winners.

Under individual matches you will see the traditional lines including moneyline, point spread, and totals, and you will see the price that another user staked for those odds. For example, you might see the Jays moneyline posted at +120 odds for $220. This means that the user who posted this risked $100 to win $120 plus their money back, and if you wish to bet against them, you must risk $220 in order win their $100 and your money back.

Back and Lay betting

Traditional sports betting involves only “back betting,” where you are betting on a specific event to come true with options such moneyline, point spread, or over/under.

Lay betting allows you to act as the sportsbook and bet against an event happing. This is the exact opposite as back betting.

Having a true understanding of the event you are wagering on or against is essential in betting exchanges. The first thing you need find out is what the true odds of the event are, and then you can compare that to the price that you see posted by another user. If their odds differ drastically from the true odds, it is likely worth taking their action.

Back betting can also be advantageous with the opportunity to create your own odds. If you post a wager at odds that are more favourable to you and you get someone to bite on your action, you can be very profitable in the long run.

You understand the two different ways to wager on betting exchange sites (back and lay betting), now let’s take a deeper dive into a few strategies that you can employ to make yourself an overall winner in the long run.

Arbitrage Betting: This is the strategy of betting on both the winning and losing side of one wager to ensure you make a profit regardless of the outcome. On traditional betting sites, users commonly take cash out of bets and hedge a small amount of their guaranteed winnings on the opposing side since they are have already secured a profit. This strategy can be employed before the match occurs on betting exchange sites since users are creating their own odds. You can take someone’s action at one set of odds and create a wager at your own set of odds that mathematically guarantees you a profit.

Matched Betting: This strategy involves using both a betting exchange site and a traditional sportsbook to your advantage. The top sportsbooks commonly have promotions with the ability to obtain bet credits (Bet $50, Get $50’ in free bets). Place your back wager on your regular sportsbook that guarantees you will receive these bet credits, and then go to your betting exchange site and place a lay bet on the opposite outcome to happen to ensure you won’t lose any money regardless of the outcome, essentially obtaining your bet credits for free.

To calculate the optimal rate to wager on your betting exchange site to ensure a profit use this simple equation:

Lay stake for an even profit = back odds / (lay odds – exchange commission) * back stake

Example: Your sportsbook has a bet $50 get $50 in free bets promotion and you want to bet on the Toronto Maple Leafs money line at 1.52. You find the same wager on your betting exchange book at 1.56 which takes 2% as a commission. Using our equation your lay stake should be - 1.52 / (1.56 -0.02) * 50 = $49.35.

You will lose $27.64 on the exchange site if the Leafs win, but you will receive $26 + the $50 bonus on the sportsbook, meaning you gained $48.36. If the Leafs lose, you will break even on the sportsbook and receive $48.36 from the betting exchange site. Either way you are losing just $1.64 to gain $50.

Next you need to place your matched bet with your $50 in bet credits. Again, you are using both websites, placing a back bet with your sportsbook in bet credits, and placing lay bet with your betting exchange site using the equation:

Lay stake = (back odds – 1) / (lay odds – commission) * free bet value

Let’s say you want to bet your $50 on the Jays to win at 2.50 odds and the lay odds are 2.60. This would mean you need to put out a lay stake of – (2.50 – 1) / (2.60 – 0.02) * 50 = $29.07.

If the Jays lose you will make $28.49, if they win you will make $75 from the betting site and lose $43.61 from the exchange site netting you $31.39. Either way it’s a guaranteed $26.85 overall profit from a very simple process.

Tips for Smart Wagering on Betting Exchanges

For those new to betting exchange, we recommend starting small before you create a large enough bank roll to increase your wager sizing. Commit to one set betting strategy and stick to it. Going rogue from your strategy and making larger bets to help mitigate losses just brings in more randomization, putting you at risk for large losses that you may not be comfortable with. Set limits for yourself to ensure you never lose more than you can afford.

There are so many bonuses available to first time players so always take advantage of these. Using the match betting strategy that you just learned is a great way to build up your bank roll at the start and something you can always go back to help build back up if things aren’t going your way.

Our final tip and maybe the most important, is to always have a good understanding of the market you are wagering on. With random players all over the country setting the odds, make sure you know the true odds of the event and take advantage of other’s mistakes. On the flips side when you are placing lay wagers and creating odds for yourself, set things in your favour but don’t go too crazy. If you fix things too far on your side, you likely won’t get any action. 

Betting exchange is legal in all provinces throughout Canada. Each province has its own set of rules and regulations, in addition to their own regulatory body. Sportsbooks need to obtain a license and be approved from this regulatory body in order to legally operate in that province.

STX is currently the only betting exchange site that has obtained a licence in Canada. The Alcohol and Gaming Corporation of Ontario awarded them an Ontario sports betting licence in 2023 and they have been operating legal in the province ever since.

There are numerous offshore betting sites that Canadians have access to, but these come with a level of risk as they are not bound by the same provincial laws as you. This means the government cannot guarantee that your money is completely secure. Betting with these sites is technically not one hundred percent legal, but it is largely ignored and low on the government’s priority list. Avoid sites that have poor reputations and sportsbooks that do not have a licence from any governing body.

STX became the first legal betting exchange site in Canada in 2023, obtaining a licence from the Alcohol and Gaming Corporation of Ontario. They are not only the largest betting exchange company in the Country, but they are also the largest in the world.

Inspired from traditional financial marketplace infrastructures, STX allows you to buy and sell sports outcomes similarly to stocks on the market. Trades are made safely and efficiently on their well-designed app. You can accept a contract that someone else has created or create a contract of your own for another user to accept.

This process allows sports bettors to get a wide range of odds for sporting events, giving them more options than just betting against standard sportsbooks. These companies set the odds in their favour in order to guarantee themselves a percentage of your winnings. STX still takes a percentage of the winnings, but you can see the true odds of the event you are betting on, and the percentage that they take is much smaller.

Your options are currently much more limited when choosing a betting exchange site as opposed to a traditional sportsbook, but here are some key factors you should consider when comparing your options.

• Number of Betting markets: The more opportunities you have to make money, the better, so look for an exchange site that offers a wide range of different sports and specific wagers to make.
• Commission: One of the biggest reasons for choosing a betting exchange site over a sportsbook are the smaller commissions. Exchanges commonly charge between 3-5% on any winnings, while sportsbooks take off 5-10% by shifting the odds in their favour.
• Liquidity: This refers to the flow of money on the exchange website, and a larger user base creates more liquidity. The larger the liquidity the better as there will be more wagers to pick up, more people accepting your wagers, and more money to win as a result.
• Reputation: Your reputation is a big deal in the betting industry, as there are still many fraudulent websites out there. Make sure to always read up on an exchange site before signing up, and ensure they have a license from a governing body. Sportsbooks that are licenced in your province directly will always be the safest options.
• Welcome Bonuses: Almost every site offers a welcome bonus to incentivise first time users to sign up. These bonuses can help you create a bank roll and are often worth taking advantage of. Some are much more favourable than others with playthrough requirements hidden in the terms and conditions, so make sure to always read the rules and have a full understanding of the requirements you need to complete before you can withdraw.
• Payment methods: Everyone has their preferred methods when it comes to transferring money, so the more payment methods that are accepted the better. Some websites charge fees and have longer wait times for withdrawals than others so make sure to keep an eye out for these things before signing up.
• Customer service: Issues are bound to arise at some point, so having an exchange site with a 24/7 customer service team will ease your nerves.

There are numerous distinctions between betting exchange sites and traditional sportsbooks, with many pros in favour of exchange.

Exchange sites offer better odds, improving your chances to win the long run. Players set their own odds and the site will take a small percentage of the winnings, whereas sportsbook skew odds slightly in their favour.

The largest difference is the ability to place lay wagers. Traditional sportsbooks only allow you to place back wagers, where you are always betting on a winner. Lay wagers allow you to act as the sportsbook and bet on the losing side of things.

Traditional sportsbooks set themselves apart by offering more sports and more specific wagers to bet on. For exchange sites to rival them in these categories, their player base will need to increase significantly, however, things are trending in the right direction.

Betting exchange sites have the potential to explode and change the betting industry forever, but there are still many areas that they need to improve on. Here are the advantages and disadvantages to exchange betting.

The advantages that exchange sites present are lower commission rates, better odds, and the ability to place lay wagers which are all massive benefits. All these factors give you a significantly better chance at become a winner in the long run.

The downside to betting exchanges is that the system relies on a large active user base. A lack of liquidity creates less favourable markets for niche events, and oftentimes you are left waiting for an opponent for long periods of time and not receiving action at all.

This betting exchange concept has a chance to explode and really revolutionize the industry, but with less users and far less betting opportunities, they have a long way to go before overtaking standard sportsbooks.

Betting exchanges are a fresh an exciting new concept that the betting industry needs. You are at a inherit disadvantage when playing on standard sportsbooks with oddsmakers skewing lines in the bookies favour.

Exchange sites give you a much better chance to profit in the long run by providing you the opportunity to act as the bookmaker and take advantage of wagers placed by others.

A large user pool is required for exchange sportsbooks to thrive, and they have a long way to go, but I think this concept is outstanding and this has a chance to be the most popular form of betting in ten years time.