Hybrid Betting Market Pivot Mechanism for Risk Mitigation

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Solution Overview

Problem

Conventional betting systems result in participants losing their entire wagered amount if the predicted outcome does not realize, and can lead to greater losses than the initial wager, posing a risk and lack of reward for close game outcomes.

Innovation Solution

A computer-implemented method and system for administering a betting market that calculates odds based on game details, determines a pivot to differentiate between winning and losing outcomes, and rewards participants based on the odds calculated for the game outcome, ensuring participants do not lose more than their wagered amount and offering increased rewards with larger margins of victory.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Reliability

If conventional fixed-odds wagering systems are used, then participants can place bets on predicted outcomes with predetermined odds, but participants lose their entire wagered amount if the predicted outcome does not realize

Engineering Contradiction:

Improvebet outcome predictabilityVSAvoidwagered amount loss

Core Design Contradiction:

ReliabilityVSLoss of energy

Solution Approach 1:

The betting system segments the total wagered amount into multiple portions that are distributed across different outcomes. Instead of risking the entire stake on a single outcome, the system automatically divides the wager among multiple possible outcomes based on predicted probabilities, ensuring that some portion is always returned regardless of which single outcome occurs.

Inventive Principle:

Principle #1Segmentation

Solution Approach 2:

The system changes the parameter of payout structure from fixed odds to dynamic proportional returns. Instead of predetermined fixed odds that result in total loss or total win, the system adjusts payouts based on the actual outcome's probability and the distribution of wagers, ensuring participants recover a proportional amount rather than losing everything.

Inventive Principle:

Principle #35Parameter changes

2Adaptability or versatility

If spread betting systems are used, then participants can wager on predicted margins with linear scale payouts, but participants can lose multiples of their initial wagered amount if the predicted margin is not realised

Engineering Contradiction:

Improvebetting flexibilityVSAvoidpotential loss magnitude

Core Design Contradiction:

Adaptability or versatilityVSObject-affected harmful factors

Solution Approach 1:

The system applies preliminary anti-action by pre-distributing the wager across multiple outcomes to counteract potential total loss. Before the event occurs, the system has already allocated portions of the stake to different outcomes, creating a protective effect that prevents catastrophic loss regardless of which outcome actually occurs.

Inventive Principle:

Principle #9Preliminary anti-action

Solution Approach 2:

The system converts the potential harm of losing the entire wager into a benefit by ensuring that some portion of the stake is always returned. The mechanism that would normally result in total loss (single outcome betting) is transformed into a protective distribution system where the diversity of outcomes becomes a safety mechanism.

Inventive Principle:

Principle #22Blessing in disguise (Convert harm into benefit)

3Reliability

If bookmakers adjust odds to minimize risk using vigorish, then bookmakers can ensure profit margin, but participants receive smaller payouts than true odds would indicate

Engineering Contradiction:

Improvebookmaker profit assuranceVSAvoidpayout amount

Core Design Contradiction:

ReliabilityVSQuantity of substance

Solution Approach 1:

The system allows participants to serve themselves by enabling them to see the true odds and make their own betting decisions without bookmaker manipulation. The transparent probability-based odds display empowers participants to assess risk and reward independently, eliminating the need for vigorish-based odds adjustment.

Inventive Principle:

Principle #25Self-service

Data Source

PatentUS20230360487A1Betting markets

Publication Date: 2023.11.09 COETZER CORNELIUS JOHANNES

AI summary

The invention provides for a computer-implemented method of administering a betting market for sports, the method includes the steps of receiving game details for a game between two parties, which includes probabilities of each outcome in an array of possible outcomes of the game, calculating an array of odds on the game details and determining a pivot in the array of possible outcomes based on the array of odds, with a first and second group of outcomes defined on opposing sides of the pivot, respectively, or on the pivot. Thereafter, bets are received from participants, each bet relating to either the first or second group of outcomes, until a predefined cut off time or outcome, whereafter a game outcome is received, and a reward is calculated for those participants who betted on the group outcome in which the game outcome falls, based on the odds calculated for the game outcome.