Gaming is supposed to look more like Wall Street financial markets – Sportico.com

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Thomas Halikias (founder, Propels football) believes that in-game microsports betting will transform the way sports fans wager on games. But the former UBS executive (he ran the Structured Equity Desk) says one aspect of the upcoming shift that is largely overlooked is the synergies between micro and traditional betting that could allow sports betting to conduct in-game hedges and increase the size of their trading books and improve their return on investment. As he explained, current iterations of micro-bet products often focus on more binary events (think: run / pass on next play) or multiple selection markets (think: the outcome of an at-bat will be a single, double , Triple, home game being run or out), which have no holistic reference to game evaluation and the traditional lines.

The market and risk expert believes the advent of micro-betting products like (a platform that offers play-by-play markets that assess the likely outcome of a drive) will make gambling resemble Wall Street’s financial markets . As Halikias explained, “the bottom line of a game will be” [start to] law [more] like the closing price of a stock, with play-by-play action tending towards that price throughout the game. ”The resulting continuous microeconomics for traditional lines would allow“ traders ”to hedge their betting risks. “Sports betting will soon look like derivative kiosks on Wall Street,” he predicted.

The inclusion of JWS: Introducing live in-game micro-betting products within a sports betting provider should encourage bettor engagement – at least initially. But as Halikias explained, “Binary bets are like tossing a coin. We could bet on it, but it’s getting boring. And once you find that the odds are against you, you lose interest pretty quickly. Therefore existing products [will] Experience the fatigue of the weather. “

Halikias suggests that a sports betting company could tie the bets by incorporating the characteristics of the capital markets into its micro-betting products. “Effective markets allow traders to express unique and diverse opinions in one place for a single price,” he said. “And the continuous nature of live markets, the tick-by-tick call to action, is fascinating.” He also suggested that communities often form around the news cycle of those markets (think Reddit’s WallStreetBets). “People like to share their opinion, be it the potential of a stock or the scoring opportunities of a team. The instant feedback from live markets makes it even better, ”he said.

Drives Football embodies these principles of the capital market. Whenever a user buys or sells a drive, they constantly have to reevaluate their position: should they double up? Do you hold or sell your “option” every time you play the drive? “It is precisely [the mentality] that makes day trading irresistible, ”said Halikias. “You never buy the bottom or sell the top. You always think about yourself. “

It should be noted that Drives Football, an early stage company, is currently only offering a free-to-play product through its app. Halikias noted, “Successful quantum models require more than just historical data. You need to factor in market dynamics and psychology (think of the wisdom of the masses) to be successful. Our for-fun market data will influence our real money models. “

Casual athletes must embrace continuous, forward-looking markets before books can use them to offset risk. “Before micro bets can become a financial product, it must first become a game for the user. Gamification precedes liquidity, ”said Bhu Srinivisan (Founder, NXTSCORE). “Across the industry, the experience has to feel like something that Epic Games does with Fortnite, Blizzard, or Electronic Arts. This will create enough trading volume to create markets. “

But Halikias has no doubt that once it is established this will happen. It’s just classic business optimization. “I ran one of the largest derivatives desks on the street and saw how derivatives markets and the technology they needed were transforming financial markets. Now it’s all led by the derivatives markets and stocks really just follow suit. The same will happen with sports games, ”he said. Of course, that doesn’t necessarily mean Drives Football will end up being the consumer micro-betting platform of choice.

While a product resembling a live futures market could be used to attract customers and increase engagement, Halikias suggests that if properly integrated, it will also increase and improve the returns on existing bets. “Whether it’s continuous markets or binary prop bets, these micro-betting markets increase the hedging capabilities of a book exponentially,” he said. “The rapid turnover of microwets requires much less capital, and sports betting can adapt their micromarkets to mitigate traditional risks. If micro-markets grow as many expect, the ability to manage in-game risk will allow sports betting to increase their traditional exposure ten fold. “

Advances in sports betting technology are needed before in-game options trading for real money can be scaled to a size that will significantly impact sports betting presence. However, Halikias predicts that these developments are in the near future. “The evolution of derivatives markets has changed capital markets and their technology, crypto’s DeFi markets, are redefining finance, and real-time games will require the same kind of sports betting technology development,” he said. He predicted “a future where stadiums will have microwave towers, like financial exchanges, that send video data almost instantly to the most demanding sports betting for high-performance analysis.”

The state nature of sports betting regulation makes it difficult to have a real betting exchange. Halikias envisions the larger sports bets aggressively purchasing micro-bets instead as a workaround for these restrictions. “The trading volume has a network effect,” he said. “The more flow you have, the bigger you can act.” He sees the biggest players as clearing houses (think: mini exchanges) with peripheral operators as brokers who attract customers through their brand, content or properties. “Understanding how and why financial markets have performed is enlightening to the future of the sports game,” Halikias concluded.

The only really plausible reason why sports betting would no longer resemble Wall Street markets is because incumbents are resistant to innovation. It’s not difficult to imagine. “Established players like the status quo – even if it’s in their best interest to optimize their books,” said Halikias.


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