Smarkets's skullduggery

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JTEDL
Posts: 536
Joined: Wed Aug 23, 2017 2:21 pm

Saw this earlier, skullduggery or user error?

https://mobile.twitter.com/SmSportstrad ... 2836814849
vide0star
Posts: 50
Joined: Thu Jul 07, 2011 8:19 pm
Location: London

PolicemanPrawn wrote:
Tue Oct 09, 2018 5:07 pm
I assume vide0star works for Smarkets. Can I ask who you are? It might be good that they're replied, but I don't believe they're doing it with good and honest intentions. I don't find their response humourous at all.
I'm Jason, I was born in North Carolina. I studied Computer Science, I'm excited about electric cars, I follow politics closely and I'm very anti-Brexit. I also founded Smarkets and I do think there was some humour in my response.
By artificial, I mean from non-customers; ie from the exchange and their partners. Artificial might not be the best word but the meaning is pretty clear.
You can parse it how you like but our market maker is a customer, like any other. It operates as a separate company. We also have 4 other institutional market makers integrated on the platform.
Having market-makers on an exchange is fine. I'm a 'market-maker' on quite a few exchanges. The problem is when the market-maker is a partner company of the exchange itself or working on their behalf, as is the case with Smarkets. It creates a conflict of interest because customers are winning directly from Smarkets (or their partners), which presumably is not something Smarkets wants, and in most cases when this arises, there is an incentive and actual actions to hinder these winning customers. Look at the softbooks. Even Asian bookmakers have minute limits for many of their markets, and may even restrict themselves. Why would Smarkets be any different? Your reply very disingenuously ignores this key part about the market-maker being in business with the exchange itself, as opposed to being an entirely separate and independent entity.
We are honest about the arrangement, I'm not sure how you take this as disingenuous. Hanson has zero preferential order placement and if you saw our P&L we lose about 49% of our bets, it adds up to a lot of money. We'd be shooting ourselves in the foot if we weren't doing the 'right' thing. It's up to you if you want to use our product or not. I have no issue if you decide it's not for you.
(1) You say "We don't mimic anything", but this appears to be a falsehood. It's pretty clear that Smarkets's market-makers mirror Betfair prices quite a lot. (It is, in fact, one of the appeals of Smarkets.) This is obvious to anyone who has used them briefly. What is your policy when it comes to winning customers and the market-makers? By default, when it comes to orders provided by the employed market-makers, orders on a price that gets cleared out get replenished (iceberg orders, they are called), so that you can keep on hitting and lifting: will they change this for certain customers? More generally, are there plans to treat winning customers differently to losing customers?
Our market maker also market makes on BF. We don't support iceberg orders at this time so it's not possible. Our matching is done with price time priority. Market makers (Hanson included) have no preference in the order book. We plan to charge high volume customers more than low volume customers, not based on P&L.
(2) What happened was I was betting on an event that wasn't due to start until weeks later. After a few bets, suddenly I had an 'in-play' delay of about 8 seconds, and future bets on that market were subject to this in-play delay. You claim that it is an error, but how can such an error even come about in the first place? Perhaps you are correct about it merely being an error, but I doubt it.
It was a bug. They happen from time to time when managing thousands of events and markets concurrently.
(3) Another claim of an error. What is your policy on showing prices when logged in vs when logged out? Are they the same? Do you show less prices when logged out than logged in? Do you show prices when logged off that are unavailable when logged in (this is the case right this very moment with at least one market)? Is this explained by Smarkets on their website?
We offer no guarantee that logged out prices are up to date but they shouldn't be that far off. There are a lot of entities that scrape our website and we delay the prices logged out to prevent people grabbing our data. Logged in the prices and order book will be up to date.
(4) So you have admitted that you do stop customers from placing bets (under certain conditions). What is your policy on "throttling" bets? Where in your terms and conditions is this explained, whereby customers cannot trade temporarily if they have traded too much? When this happened to me I couldn't trade on that market for about ten minutes.
I'd have to find it, but you have to betting a lot or hitting the website a lot to hit this limit. We want high volume customers to use the API. If you haven't been offered, please send [email protected] an email and we'll get you added to the queue.
(5) I'm not sure why you think asking Smarkets about their problems is a better idea than posting on a neutral forum, but I think it's because you don't want your skullduggery to become public. I find your reply pretty dishonest and evasive. I think you are used to being able to BS people, but be warned that that doesn't work on me, and I'm pretty tenacious when it comes to seeking out the truth.
Our annual reports are public, I answer questions on twitter, this and other forums, we have open houses that customers are invited to, 24h support chat, a great customer service team. I wouldn't call that, er, evasive.

I am used to trying to convince people with logic. I'm not very good at BSing to be honest.
I will continue using Smarkets because it will be a profitable enterprise. But from now on, I'll be very closely watching them for any signs of skullduggery, and collecting evidence in the form of screenshots and videos, which I may make public once I've gathered enough evidence.
We are removing skullduggery (I did it again!) from our business plan. Thank you for keeping me honest.
vide0star
Posts: 50
Joined: Thu Jul 07, 2011 8:19 pm
Location: London

JTEDL wrote:
Wed Oct 10, 2018 7:38 pm
Saw this earlier, skullduggery or user error?

https://mobile.twitter.com/SmSportstrad ... 2836814849
I answered the tweet directly.
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SeaHorseRacing
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JTEDL wrote:
Wed Oct 10, 2018 7:38 pm
Saw this earlier, skullduggery or user error?

https://mobile.twitter.com/SmSportstrad ... 2836814849
Tbh the price could have just gone when it was placed....
vide0star
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Location: London

sa7med wrote:
Tue Oct 09, 2018 5:19 pm
I applied for api access quite some time ago. Never even recieved a response. ..
If you send me an email jason dot trost at smarkets dot com I can have a look at what happened. We try to respond to 100% of api emails, so I apologise if you didn't get a response.
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Euler
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Location: Bet Angel HQ

It doesn't seem realistic to think that an exchange would not execute at the best price. The number of complaints you would get would be incredible. Most likely the price moved, but even then an exchange user would still surely offer a price into the exchange as a safeguard anyhow, if not they are going to get caught now and again.
vide0star
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Location: London

Euler wrote:
Tue Oct 09, 2018 5:18 pm
I think we should all respect the fact that Jason is happy to come on here and answer questions, which is a rare thing nowadays.

I think we all realise that businesses also have commercial objectives that need to be met. Ultimately that's up to each business to decide how to meet them. From my perspective increased competition in the market is a good thing. Even if short-term it's not obvious where the benefit is.

It's up to each business to convince each of us to move our business through a range of policies and incentives and generally as competition increases for business that should have positive effects for the industry in general.

That's the theory anyhow!
Thanks! It's not unique to this forum, but I find it surprising how acrimonious the relationship between customer and operator is sometimes. Maybe people feel like they've been taken advantage of but I am really here to "clean things up". I can answer a lot of questions about why BF, BD and MB do certain things since I have a lot of operator experience and please feel free to use me as a resource if/when appropriate.
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SeaHorseRacing
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Think we should give Jason a break. It’s like he’s cornered with sucker punches.
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Dallas
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vide0star wrote:
Wed Oct 10, 2018 7:57 pm
I can answer a lot of questions about why BF, BD and MB do certain things since I have a lot of operator experience and please feel free to use me as a resource if/when appropriate.
To lighten it up a bit perhaps you can answer why BF has so many 'Technical Issues' they always struggle with anything near a satisfactory response :lol:
vide0star
Posts: 50
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Location: London

Dallas wrote:
Wed Oct 10, 2018 8:03 pm
vide0star wrote:
Wed Oct 10, 2018 7:57 pm
I can answer a lot of questions about why BF, BD and MB do certain things since I have a lot of operator experience and please feel free to use me as a resource if/when appropriate.
To lighten it up a bit perhaps you can answer why BF has so many 'Technical Issues' they always struggle with anything near a satisfactory response :lol:
My guess, and I want to emphasise it's just a guess, is two reasons.

1) They have an old-ish technical stack. This presents all sorts of problems and gets worse as time passes. An example problem might be you have a database that has 100gb of space. As it fills up you need to find a way to make the database bigger. You can't just increase the database size without downtime. There will be 10s of these issues that get harder if you don't pay what's called "technical debt".

2) Exchanges are hard to split up. That means putting trading on multiple servers so that if one group goes down, the rest still operate as normal. It's hard to split because betting exchanges need to keep track of real time exposure across all contracts and sports. An example would be, say you had a football exchange server and a horse racing exchange server, it would be nice if horse racing crashed, that you could still trade football. It's very difficult though because your exposure in horse racing is linked to football exposure.
vide0star
Posts: 50
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Location: London

SeaHorseRacing wrote:
Wed Oct 10, 2018 7:59 pm
Think we should give Jason a break. It’s like he’s cornered with sucker punches.
Heh, I really don't mind tbh - it's part of my job. I just would say you guys will get more use out of me if you don't treat me as the enemy. The forum will get more value if it's not about mudslinging but actually understanding the issues of exchange market micro structure, of which I have unique experience to comment on.
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Dallas
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vide0star wrote:
Wed Oct 10, 2018 8:10 pm
Dallas wrote:
Wed Oct 10, 2018 8:03 pm
vide0star wrote:
Wed Oct 10, 2018 7:57 pm
I can answer a lot of questions about why BF, BD and MB do certain things since I have a lot of operator experience and please feel free to use me as a resource if/when appropriate.
To lighten it up a bit perhaps you can answer why BF has so many 'Technical Issues' they always struggle with anything near a satisfactory response :lol:
My guess, and I want to emphasise it's just a guess, is two reasons.

1) They have an old-ish technical stack. This presents all sorts of problems and gets worse as time passes. An example problem might be you have a database that has 100gb of space. As it fills up you need to find a way to make the database bigger. You can't just increase the database size without downtime. There will be 10s of these issues that get harder if you don't pay what's called "technical debt".

2) Exchanges are hard to split up. That means putting trading on multiple servers so that if one group goes down, the rest still operate as normal. It's hard to split because betting exchanges need to keep track of real time exposure across all contracts and sports. An example would be, say you had a football exchange server and a horse racing exchange server, it would be nice if horse racing crashed, that you could still trade football. It's very difficult though because your exposure in horse racing is linked to football exposure.
Right or wrong that's more info than Betfair have provided following all their outages combined

As Euler and others have said already it deserves respect and acknowledgement that you have taken the time to try and answer all these questions - something Betfair can certainly learn from
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Euler
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Location: Bet Angel HQ

For people interested in the Architecture at Betfair this is an old presentation when they sat on their old infrastructure: -

http://www.hpts.ws/papers/2007/HPTS%20W ... ywheel.pdf

I checked to see if the presentation was still publically available.
foxwood
Posts: 390
Joined: Mon Jul 23, 2012 2:54 pm

vide0star wrote:
Wed Oct 10, 2018 7:48 pm
We are removing skullduggery (I did it again!) from our business plan. Thank you for keeping me honest.
:lol:
Trading96
Posts: 470
Joined: Thu Mar 16, 2017 4:47 pm

JTEDL wrote:
Wed Oct 10, 2018 7:38 pm
Saw this earlier, skullduggery or user error?

https://mobile.twitter.com/SmSportstrad ... 2836814849
They need a slight lag I think, if the price just changes as you click then it still places the bet at the old price.
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