Two days after Joe Biden’s inauguration, the Independent Betting Adjudication Service (IBAS) in the United Kingdom released a statement defending the right of UK sportsbooks to settle 2020 presidential election bets. The impact of election deniers it stated in part:
“Following the inauguration ceremony on 20th January 2021, we can see no reason why any betting business would not close bets on the presidential election, paying out on Joe Biden as the 46th US President and treating bets on all other potential candidates as unsuccessful.
“Reaching this decision does not make any comment on events that may transpire in the days, weeks, months or years to come. The decision makes no comment on the integrity of the election process. What we do believe is that when bets are placed on the outcome of an election, in the interest of fairness to every bettor there must be a point at which some bets are deemed to be winners and others are deemed to be losers. We consider the debate about the winner of the election closed from a betting perspective.”
In December 2020, election deniers threatened UK sportsbook, Betfair, with lawsuits for calling the election for Joe Biden. (No such lawsuit has been filed.) Betfair made its call after the electoral college voted on December 14. Betfair waited until after states’ Safe Harbor dates, which is the deadline for states to settle recounts, legal issues, and finalize how electors will vote.
Trump’s lies about fraudulent votes in key states have infected the Republican Party. With 2022 Midterm candidates — some of whom could oversee the 2024 election certification — endorsing election lies, sportsbooks and prediction markets with political odds will face the same election deniers’ claims.
Impact of Election Deniers
Sportsbooks don’t decide elections. Ballots decide elections. Sportsbook odds and prediction market prices reflect what that market’s bettors think will happen. Many users rely on the same public information that any other political consumer does.
Some users, like election deniers, can pump enough money into an election market to skew the prices. UK sportsbooks received so much money on Trump in the 2020 election that Trump’s odds listed him as a favorite even as Biden’s win was coming into view.
In that case, UK sportsbooks lowered the odds on Trump to avoid too large a payout if he won. Those books also needed to attract Biden bettors to balance their potential payouts. So, Biden looked like a long-shot underdog even as the electoral returns were beginning to point to his victory. That had everything to do with over-zealous Trump bettors and nothing to do with Trump’s electoral reality.
Election deniers are uninterested in this nuance. They’re more interested in looking for evidence that confirms their conspiracy theories. So, it’ll be up to reasonable voters to watch for misinformation and learn how to correct it.
Election Betting and Contentious Midterms
Sportsbooks overseas and election markets at home should expect challenges from election deniers who lose their election bets. Any business taking election bets will deal with some of the same accusations that election officials will.
Election betting companies can point to events like the mid-December state electors’ votes or even the January 6 certification of state votes. (This is a good approach for defending bet settlement, but it’s a lazy and weak defense for the integrity of the world’s oldest democracy.) Election betting markets will have to be as ready for the delays in final vote counts as much as American voters will.
If election deniers lose, they’ll latch onto anything to justify their lies. Justifications will include false claims of election interference to biased poll workers. Election deniers could point to sportsbook odds or prediction market prices as evidence of a supposed win.
However, these prices do not decide the election. Prices change in response to polls, vote counts, and election outcomes. Election odds are not a substitute for votes. In an era of mainstream election denial, these warnings cannot be repeated often enough.