Two brand-new sportsbooks launched in New Jersey at the start of the NFL season. Theyre interesting for a few reasons:

Betting exchanges, Prophet Exchange and Sporttrade, have been trying to launch in New Jersey for more than a year. They finally got live ahead of the 2022 NFL season.

Its been cool to see a startup arms race between two companies with first-time sports betting founders trying to do something very similar, but going about it in a completely different way.

I bet on both exchanges over the last few weeks and explain my first reactions below. Full disclosure, Action Network has an affiliate relationship with Prophet, but not Sporttrade.

First, lets dive into what a betting exchange is.

So what is a betting exchange? Its essentially peer-to-peer wagering, and the house takes a 2% cut on winnings, and nothing on losses. That will lead to massive savings for bettors.

On Thursday Night Football in Week 4 for example, moneylines on Prophet closed at Dolphins +176 and Bengals -180 both the best in New Jersey. Most other books had around -190/+160.

Because you pay 2%, the lines end up being a little worse if your +176 winner cashes, its really more like +173.5.

You can get point spreads at even money, then you pay a 2% commission.

Heres how a $100 moneyline bet looked for Dolphins-Bengals, with the commission included.

*After the commission is taken out

Sounds too good to be true, right? Is there a catch?

Sort of. The perceived hurdle to exchanges working in the U.S. has always been liquidity.

In order to facilitate a peer-to-peer marketplace, there needs to be a buyer and seller on each side of any bet. The house isnt actually taking any action. And in the U.S., the Wire Act prevents bettors in different states from wagering against each other.

So even if Prophet and Sporttrade operated in 30 states each, Indiana bettors could only wager against Indiana bettors, NJ vs. NJ bettors, etc.

So the question becomes if you want to bet $5,000 on Dolphins moneyline, will there be someone on the other side to bet against you? Well find out.

While these products attempt to offer a similar value prop the best prices in the industry they went about achieving it in completely different ways.

They both take 2% commissions on winning bets, but the similarities mostly end there.

Sporttrade is trying to mimic a stock trading environment, not a sports betting environment. They post everything in probabilities out of 100%, and call them contracts. There really arent American odds on the platform.

There are two ways you can think about how Sporttrade does its pricing.

I prefer the first method, because Im rarely betting such specific amounts on a team. Im usually flat-betting $50. Im not going to change my bet size to $58 just to make it even.

The interesting thing about Sporttrades approach is that it doesnt feel anything like sports betting. It feels like day trading, but the things youre trading just happen to be sports.

That was the vision behind the product Sporttrade wants to be the Robinhood of sports betting.

This was initially a pretty big turnoff for me. I dont come from the financial world. I make a handful of stock trades per year and Ive never used Robinhood.

After watching some of their videos and playing around for a few hours, it started to make some more sense. But I almost had to disconnect my sports betting brain.

Normally, my thought process for betting goes like this:

With Sporttrade, I found it harder to equate the best line with what was available. Should I bet the Chiefs at $43, or +125 at WynnBet? (The answer is Sporttrade in this scenario, even after the commission, because the price is about +129).

Id get used to doing the calculations off the top of my head if I use the product enough, but I think this will be a hurdle for many existing bettors. While professional bettors think in implied probabilities, Id venture to guess 98% of existing American bettors are more comfortable with American odds.

Maybe its a plus for day-traders-turned-sports-bettors, but Im not sure how many of those there are.

Prophets approach is totally different. It feels like sports betting. And its app is very minimalist (at least for now), which is totally fine.

The company wants to offer the best price in the market on spreads, moneylines and totals. Thats it. They dont want to be Robinhood, or mimic trading in any way. Its a sports betting product.

This made it much easier for me to understand from the jump.

I liked Florida State moneyline against Clemson, and Prophet had the best price at +152. Done.

1. The User Experience:Its clear that Sporttrade invested a lot into the quality of its mobile app. To be the Robinhood of sports betting, you need to provide a clean, easy-to-use interface that doesnt lag. The app is sleek, it works well, and has some cool designs.

2. The Portfolio View:To be the Robinhood of sports betting, you need to provide a user experience that makes betting seem like investing. Thats what Sporttrade did with its Portfolio tab.

Instead of a pending bets view, it gives you real-time looks into how the prices of your bets are changing.

I made these $5 bets in GuardiansYankees Game 2:

After New York went up 2-0 in the bottom of the first, my positions had gotten worse, except over 6.5. Because the live total was trading higher, it had gone up in value. The others were now less likely than they were pregame.

Then after the Guardians escaped the second inning after putting a few runners on base, I sold my under 8.5 bet at a small loss. Im now down to three bets.

This is especially nice during a busy window of live games, where things are changing so quickly. You can sell your positions rather easily.

After the Guardians came back and won, my portfolio of course went up in value.

Even though the contracts are a bit confusing to me, the live trading experience is cool.

It makes sense when you see your bets gaining and losing value as you watch the game.

3. More Markets: Sporttrade offers a few additional bet types, like golf outrights and title futures like the Super Bowl winner and the NBA title winner.

The cool thing about markets like this is you can take the no side of a longshot future. They call it the sell side.

For example, if I want to bet that the LA Clippers will not win the NBA title, I can sell a contract for $12. That means $88 wins about $12.

That effectively means Im betting -750 that LA wont win it all. You need to have pretty deep pockets to bet these consistently, but its nice to have the option. Almost every other sportsbook makes these one-way markets, allowing them to price them wherever they want with no repercussions.

1. The lines stay the same: Sporttrade posts its own spreads and totals, and then the market moves the vig around it, in line with movement elsewhere in the betting market.

Prophet on the other hand allows you to post your own spreads and totals, though they most likely wont get filled unless theyre the best price available.

For example: the GiantsRavens total was listed at 44.5 earlier in the week at Sporttrade. Other sportsbooks eventually moved to 45 and 45.5.

So bettors move the vig around the total of 44.5 at Sporttrade, to be more in line with what other sportsbooks have done.

That creates the following market:

*Implied odds with commission included

Lets say I want to bet $100 on the over.

I now need to decide if I should bet over 44.5 at about -115.5, over 45 at -108 at WynnBet or over 45.5 at -104 at FanDuel.

I can use the best odds column on our NFL odds page to see which line is better, but its tricky to figure out on your own or if youre in a time crunch before a game (the over 45 at -108 is the best, by the way).

You do need to re-train your brain if you come from a sports betting background.

2. Pricing in contracts: As I just noted, I dont think the sports betting as investing concept is for me. Sporttrade clearly executed on its vision, and if the users they believe are out there are really out there, they will succeed.

Ive had too hard of a time equating contracts to odds. Maybe its easier for someone who has never bet sports or looked at American odds to understand right away.

I could also see this format being preferred for actual investors or market-makers betting big money at these exchanges. But again, I am not that person.

That said, the pricing is strong. Thats the beauty of the exchange model. Every game is going to have an overround of 0.5% to 1.5%. And as long as theres liquidity, Ill keep money on Sporttrade and continue to bet there.

3. Home Teams Are Listed on Top: On every (American) sports scoreboard, or at any sportsbook, the home team is always listed at the bottom in a matchup view. Sporttrades is the opposite, which drives me crazy.

1. The Best Moneyline Prices:On many games in many sports, Prophet will have the best moneyline prices, even after you factor in the 2% commission.

This is the biggest pro or con of either site. With 30+ sportsbooks in NJ, you need Prophet as a major part of your rotation if you care about price. Its a clear differentiator. Sporttrade also has strong pricing, but its not as apparent when comparing it to the rest of the market i.e. is Chiefs at $43 better than Chiefs +130?

The exchange model allows bettors to create such tight overrounds the implied percentages over 100%, which shows you how strong the overall pricing is. (So if you had two lines at +100, each are 50%, and the overround would be 0% because they add up to exactly 100%).

For example, 90 minutes before Yankees vs. Guardians Game 2, this is what the moneylines looked like:

With the commissions baked in after if you win, the prices would be more like -151 and +141, but those are still just about the best-in-market as of 90 minutes before the game.

2. It Feels Like Sports Betting:With how my brain is wired, Id prefer to see things in American odds. I want to find a bet to make, find the best price, and bet it.

Prophet is keeping it simple, and banking on price being its main value driver. Sporttrade is trying to re-imagine sports betting entirely.

1. The Spread & Total Straddles: Prophet may offer +100 on its spreads and totals, but it never actually has the best spread or total number. Let me explain.

All spreads and totals will be half a point off each other. Lets look at a few NFL games for Week 6:

And Giants-Ravens:

So while youre getting even money on these spreads and totals, youre rarely actually getting the best of the number.

This creates a scenario like Sporttrade, where I need to figure out whether or not I should bet Ravens -5.5 at -108, or Ravens -6 at Prophet (+100, but more like -102 with the commission).

Or if I want to take the Giants, do I take +5.5 at Prophet or +6 at -110 at BetMGM? There are plenty of calculators out there to figure it out and our odds pages can do a lot of the heavy lifting.

But unlike with Prophets moneylines, it takes some work to figure out if youre really getting the best number available.

Its not always the worst price available the Devils-Ducks total on Tuesday is listed at 6 and 6.5. So since its even money with a 2% commission, its better than 6.5 at -110 on both sides, which is where the line sits everywhere else.

2. How Commissions Are Displayed: I dont think the commissions are properly displayed or represented in some spots at Prophet.

For example, I bet $60 on the New York Rangers moneyline against the Wild at +128. They won, so I profited $76.80. Then Prophet takes 2% of my winnings, or $1.54.

In my bet history, it says that I won $76.80. I have to go into my Account Statement details to see how much commission was actually taken out.

Sporttrade is a little more straightforward, as they list the potential profit before you even place the bet with the commission taken out.

Prophet does only take 2% of your total winnings on a market so if you bet $100 on the Giants, then $80 on the Ravens, and won $20 total, the commission only comes out of the $20 in winnings. Not the $100 on the Giants.

Sporttrade has a lot of consumer education to do. I spend all day inside sports betting products for a living, and I had a hard time figuring it out at first.

Prophets path is a little more straightforward get enough sports bettors and money on the platform to create a sustainable exchange.

Perhaps Sporttrade will help reinvent and reshape how the sports betting industry thinks and behaves, but I dont believe the broader U.S. market is ready for that yet.

So Prophet is my preferred exchange for now.

More here:

Prophet vs. Sporttrade: Which NJ Betting Exchange Should You Use? - The Action Network