Details of the move
Nasdaq, Inc. will be bringing its brand and technology to the United Kingdom soccer gambling market by partnering with Football Index, a UK betting platform.
The stock exchange group will be aiding Football Index to develop its trading platform, which will include the use of a number of tools that are part of traditional stock exchanges.
The new platform will see bettors being able to put wagers on certain players by purchasing and selling stakes which relate to their performance on the pitch.
Football Index has been in operation for nearly five years, having launched its virtual stock market back in 2014. This has given users the ability to purchase shares in leading footballers, such as Cristiano Ronaldo or Lionel Messi.
There is a combination of sports betting and fantasy football as part of this new platform, in addition to the stock market aspect.
Use of this technology
The Nasdaq technology at Football Index will be incorporated in the same way in which a stock exchange would use it. The software acts as an automatic matchmaker, connecting sellers with buyers. It can track prices in real time and process trades almost instantly.
While it has made known its similarities to a traditional stock exchange, Football Index is still under the regulation of the UK Gambling Commission. This is because it does not offer real shares in players.
Rather, gamblers can purchase a stake, with the value depending on the performances of the player in question. According to the company’s Chief Executive Adam Cole, they are not shares, but a “three-year bet on the performance of those football [soccer] players.”
The Nasdaq technology can track prices in real time and process trades almost instantly.
To work out the values of the players, Football Index utilizes an online soccer news platform it owns called Football Buzz, as well as a points system calculator.
Cole says it’s possible that in the future, some of their products may be seen as investments and therefore fall under the regulation of the UK Financial Conduct Authority (FCA).
The UK gambling ombudsman has asked the likes of Football Index to clear up potentially misleading language on their websites. Some of the language is more akin to normal investing than gambling.
Nasdaq exploring new markets
There is now a lot of competition for Nasdaq in its core business. This is why, in recent years, it has been expanding its views outwards and into new horizons.
Nasdaq is already the technology provider to dozens of different stock exchanges from all around the globe, such as in Iraq, Bermuda, and Sweden. It is also behind the technology of some cryptocurrency exchanges.
Other areas of interest for Nasdaq through its Nasdaq Ventures subsidiary include computing technology, data analytics, and blockchain. The stock exchange group is also looking closely at the nascent sports betting sector in the United States.
Opportunity in the UK
While most major companies in or around the gambling space are looking at opportunities in the US, Nasdaq sees potential in the substantial UK market.
The sports betting market in the region is well established, with bookmaker shops found on the majority of shopping streets throughout the UK. In the reporting period ending September 2018, there was a gross gambling yield in the region of $18bn according to UK Gambling Commission figures. It appears that there is a lot of money in this space for the likes of Nasdaq to target.