Horse Racing Partnerships discuss exchange Wagering
From the beginning of horse racing in the United States betting has played a very prominent and important role in the sport. When race tracks began taking wagers from the general public it was, and still is the biggest source of revenue for race tracks. Essentially, without pari-mutuel wagering there would be no horse racing. But today, racing has evolved alongside of technology and has wagering available not only at the track itself but also on online platforms, in which the racetrack is able to take a certain percentage of what is wagered online.
Traditional betting in horse racing is pari-mutuel wagering which is defined as a betting system in which all bets of a particular type are placed together in a pool, taxes and the house take out are removed and the payoff is calculated sharing the pool among all winning bets. In horse racing there are many different types of bets that have their “pool” whether it may be win, place, show, exacta, trifecta or even pick fours and pick sixes. Currently, all these bets are strictly win wagers that must be placed before the specific race takes place.
In 2000 a new type of wagering, Exchange Wager, was introduced to thoroughbred horse racing in the United Kingdom, where it has been quite popular. Exchange wagering is a form of pari-mutuel wagering in which two or more persons place identically opposing wagers in a given market. For example, bettors can place wagers on whether a horse will win or lose a race, and also have the ability to bet on a race in progress. Because exchange wagering has been so popular in the UK there has been a strong push to get exchange wagering into the U.S.
California has been one of the leading states along with New Jersey to potentially use exchange wagering in a trial period. The California Horse Racing Board (CHRB) has been leading the way, in conjunction with California race tracks to promote this new type of wagering in California. They feel that bringing exchange wagering to horse racing in California will attract new bettors who regularly wouldn’t bet with traditional pari-mutuel wagers. The main opposition consists of the Thoroughbred Owners of California (TOC) as well as the thoroughbred trainers. The main reason certain groups and fans are against exchange wagering is that owners, trainers, jockey’s, and those involved in the game would have the ability to bet against their own horse, and have the ability to profit from losing a race.
Luckily, the CHRB has just recently proposed a rule that if exchange wagering is to be implemented, owners, trainers, jockeys, and those involved with the horse will be prohibited from wagering against their own horses. Though this is a necessary rule and precaution it will surely be hard to prevent those determined to break the rules. And though this rule was recently passed by the CHRB, it will still need approval from the state’s office of Administration Law, which is a process that can take several months and then it must make its way to the Secretary of State for final approval.
Unfortunately for the CHRB and those backing exchange wagering, it still seems that horse racing partnerships, individual owners, and trainers are still mostly opposed to the idea of exchange wagering because it will question and test the integrity of the game and the amount of money that will go to purses is in question. Furthermore, it looks like it will be well into 2013 until we have an official decision and how if it is approved, exchange wagering will be set up. But with the potential boost in handle for tracks and economic increase for the sport in general, I am sure all horse racing fans would agree that it would be beneficial for the sport to find a way to implement it while still maintaining a high level of integrity.
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