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Below the largest exchanges, he sees numerous operators competing for relatively small shares of a fast-growing category. “If you get 1% of this market, I think it’s a huge opportunity,” Patel said. “There are a lot of people fighting to get 1%.”
Jefferies estimates exchanges can retain approximately 65% of explicit transaction fees, with the balance distributed across clearinghouses, brokers and liquidity providers. It therefore expects more operators to bring parts of the infrastructure in-house.
For the independent suppliers growing alongside them, however, the opportunity expands with every new exchange, contract and market maker. The consumer-facing platforms may attract the users, but their products cannot trade at scale without the data, liquidity and operational machinery developing behind the screen.
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This summer, the Commission reached settlements of £900,000 with Betfred over safer gambling failures, £4.75 million with Evolution over weaknesses in its AML risk assessment and supply-chain oversight, and £122,835 with Stakelogic after games were found to be running faster than permitted.
Taken together, the cases provide further ammunition for the anti-gambling lobby at a time when it is already facing political pressure, tax increases and demands for tighter restrictions. Each apparently avoidable failure makes it harder for the industry to argue that existing regulation is sufficient.
Yet Dan Waugh, partner at Regulus Partners, pushes back against the idea that enforcement notices reveal a fundamentally non-compliant sector.
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The responsibility for a piece of work increasingly extends from identifying the problem to building, releasing and measuring the result.
The transformation has not eliminated all of Cubeia’s concerns. And inevitably some coders are missing their original role.
“We still have people who loved the coding part – solving problems with code and writing beautiful code. They’re struggling with the change. For some people an important part of their work that they genuinely loved is now gone.”