Wednesday, 3 December 2008

Spreadfair close down

Hardly a surprise really when you think about it. Exchange betting and spread betting are the most difficult forms of betting to understand. So what happens when you combine the two? You have a concept which is bloody hard to explain and appeals to a very tiny sector of the betting public! Exchanges rely on liquidity. To get liquidity, you need lots and lots of punters. Spread firms are niche betting companies, they will never become mass market due to the credit checks etc that people require to get an account. Also, spread betting is almost completely restricted to the UK. There is no international market for it. Combining the two most difficult concepts was always going to struggle, it looks like Cantor have simply given up a business that cost too much money and was never going to make it.

On the Spreadfair website:

Dear Cantor Spreadfair Customer

Cantor Index Limited has taken the decision to close Spreadfair, its online betting exchange, to focus on its financial spread betting and CFD business.

Effective from 4 pm, 1st December 2008, Cantor Spreadfair will cease to accept new customers and will take no further opening wagers.

Any funds that you have on deposit with us remain totally secure and any funds not required to support open bets will be refunded to you immediately.

If you have any questions, please contact our customer services team on 08000 111 441.

2 comments:

  1. I have been a big client of Spreadfair's since they launched. I am lead to believe that the business was profitable. A management buyout was a possibility, but would have required a very large line of credit which is obviously not easy to come by at present.

    The decision to close may have been more political with Cantor not wanting to be running online gambling given the dim view in which this is held by some in the USA. Note that other Cantor online ventures also bit the dust last weekend (online casino).

    The spread betting arena is niche, but I hope and believe that an exchange could again make an appearance as it is the only counter to monopolistic and underhand practices that have been seen to develop within the mainstream spread betting companies.

    ReplyDelete
  2. Thanks for your comment. My mail was that they cut back on credit due to the state of the economy and this severely affected the liquidity.

    When dealing with parent companies with bigger aspirations, who knows what they might have been up to. The Cantor online casino closed up as well.

    To develop a spread betting exchange, they'd have to throw a lot of resources into awareness and education, something they may have thought wasn't right in the current climate.

    ReplyDelete

Thanks for your comments, but if you're a spammer, you've just wasted your time - it won't get posted.