Key Highlights
- Crypto.com added a 3-second delay for retail sports bets, while market makers are unaffected.
- Experts say the delay gives professional traders an advantage, especially against courtsiders.
- The change has sparked fairness concerns, creating a potential two-tier system for users.
Crypto.com has introduced a three-second delay for retail users placing sports bets on its prediction market. Market makers, who are professional traders, are exempt and can place orders instantly. This different treatment of its user base has sparked outcry, with critics arguing that the exchange is clearly giving market makers an advantage.
The company said the delay is designed to “support liquidity and fairness.” The rule was included in a filing with the Commodity Futures Trading Commission on July 30.
3-second delay gives pros an edge over retail traders
For regular users, this means their bets are processed three seconds after they place them, which would give market makers a head start. Bloomberg framed this as a “3-second advantage” for professionals.
Alfonso Straffon, a former sports trader and analyst at Deutsche Bank, said, “This three-second delay really protects market makers from courtsiders or even individuals that correctly anticipate a sudden, market-wide move in the odds.”
Courtsiding is when someone at a live sporting event places bets using what is happening in real-time, before the wider market knows. Straffon added that even a few seconds can give professionals a big advantage.
Critics raise concerns about unfair treatment
This change has caused debate in the market over fairness. According to Bloomberg, critics say this creates a two-tier system, where professional traders get better chances than regular users.
The delay could also attract large trading firms to the platform, which would make it easier for them to trade with internal data access. But similar rules in stock and futures markets have faced complaints because they gave high-speed traders an advantage over ordinary investors.
Separately, Kalshi Inc., another major prediction market, filed a proposal with regulators to allow potential delays on its platform. “This is just a filing. We haven’t implemented anything and have not decided whether we will,” a Kalshi spokesperson said. The proposal is currently under a 10-business-day review by the CFTC and could be approved soon if regulators do not raise any issues.
Delay favors professionals
Three seconds is a big time in the numbers market and can make a difference in fast-moving sports markets, especially when odds can change quickly after a goal, score, or injury.
Regular users will face the delay, while big trading firms like Susquehanna International Group and Jump Trading may benefit. Kalshi’s trading team, which is separate from the main platform, has also faced criticism from retail users who say it profits from them. Though the company said its team gets “no preferential treatment.”
Prediction markets have grown fast around sports events, but Crypto.com’s three-second delay shows how small amounts of time can give professional traders an advantage. This questions the fairness for regular users and the future of prediction markets.
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