Ron Bernstein was standing in the pit of the New York trading floor when it he and some his colleagues began contemplating the idea of trading sports the same way people trade stocks.
Bernstein had traded commodity options for 30 years before he founded TradeSports.com, the first and only fantasy sports experience when users operate in real-time with actual money. He joined Benzinga’s #PreMarket Prep recently to talk about where the idea came from and how it works.
“I was trading cotton futures and cotton options at the time,” Bernstein said. “It was during the March Madness period when the tournament was going on.”
Bernstein explained that during downtimes of the trading day, people would come out of the pit and try to place wagers on different teams.
“Guys were looking for prices, and they were matching liquidity on sports bets when the markets were quiet,” he said.
Then Bernstein and some other traders starting thinking: Why can’t people trade sports just like we trade stocks and commodities?
“We were looking for a standardized contract, which a futures market is,” he said. “We were looking for liquidity where everybody can contribute their liquidity in one place, which an exchange does.”
They also wanted a place that guarantees that the winners would get paid, so that no one would have to chase down the money. The result was TradeSports, a first-come, first serve “proper” exchange for buying and selling props on sporting events, Bernstsein said.
Check out his full interview here:
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