A betting exchange is the foundation of matched betting. Without one, you cannot lay bets — and without lay bets, you cannot remove risk from your bookmaker bets. Opening an exchange account is free and takes about five minutes.
What is a betting exchange?
Unlike a bookmaker that sets odds and takes your money when you lose, a betting exchange is a marketplace where bettors trade directly with each other. This means you can "lay" — i.e. act as the bookmaker and bet that an outcome will NOT happen.
Betfair vs Smarkets — which should I use?
- Betfair Exchange: The largest exchange in the world with the deepest liquidity. Better for matching bets on less popular markets. Commission is typically 2% on winnings.
- Smarkets: A fast-growing exchange with a cleaner interface and lower default commission (2%). Often better for beginners because the UI is simpler.
- Verdict: Open both — Smarkets for everyday use; Betfair as a backup for obscure markets with more liquidity.
How to open your exchange account
- Visit the exchange website (Betfair.com or Smarkets.com).
- Click "Join" or "Sign Up" and enter your name, date of birth, email, and address.
- Verify your identity if prompted (standard KYC — photo ID or utility bill).
- Deposit funds. Start with £50–£100 to cover your first lay liability. Debit card deposits are instant.
- Navigate to the sport/market you want and find the "Lay" tab.
Understanding lay betting
When you lay a selection at odds of, say, 3.0, you are saying "this outcome will NOT happen." If you are right, you collect the backer's stake (e.g. £10). If you are wrong, you pay out the winnings (£10 × (3.0 – 1) = £20). This potential payout is called your lay liability.
Commission
Exchanges charge a small commission (typically 2%) on net winnings in a market. The EarnXtra calculator already accounts for commission when it calculates your recommended lay stake — so no manual maths needed.
Tips for your first lay bet
- Start with a popular Premier League match — these have the tightest back/lay spreads.
- Aim for lay odds below 5.0 to keep your liability manageable.
- Always use the calculator first to confirm your lay stake before placing.
- Double-check the selection name and market (e.g. "Match Odds" not "Asian Handicap").