Honor-based betting exchange

Abstract

An honor-based betting exchange facilitates transactions connected with bets among members of the exchange. A member need not pay his losses but his behaviors on the exchange are tracked by his honor rating. The exchange allows bets to be listed in classes facilitating searches and sorts to be performed. Upselling is possible to attract a large number of bettors. Bet matching software determines redundant bets and bring these bets to the attention of bettors. Although fixed bets are possible, certain bets can be negotiated on the exchange.

Description

TECHNICAL FIELD

The technical field relates generally to software, and more particularly, to an offline or online exchange for facilitating transactions connected to betting.

BACKGROUND

This background is provided to help the appreciation of the technological context. This background is neither intended to identify features of the claimed subject matter nor is it an admission of the prior art. Gambling means to risk or stake something of value upon the outcome of a future event beyond one's control. Most betting is gambling, and as such, it is prohibited in many states. Not all betting is gambling, however. If two persons bet on a Saturday morning round of golf, for example, they are not gambling because they control the outcome. If these two persons then retire to the grill, and bet on a football game on television, but make a handshake “just for the fin of it” bet, they are not gambling because there is nothing of value at stake. Various embodiments of the present invention focus on a third type of legal betting-betting without risk.

SUMMARY

This summary is provided to introduce a selection of concepts in a simplified form that are further described below in the Detailed Description. This summary is not intended to identify key features of the claimed subject matter, nor is it intended to be used as an aid in determining the scope of the claimed subject matter. A system, method, and computer-readable medium for betting is provided.

In accordance with this invention, a system form of the invention includes a computer system that comprises an exchange that facilitates transactions connected with risk-free bets among members of the exchange. The system further comprises a piece of evaluation software executing on the computer system. The piece of evaluation software provides an evaluation index for each member of the exchange, which is used to police risk-free bets on the exchange.

In accordance with further aspects of this invention, a method form of the invention includes a computer-implemented method that comprises accessing an honor-based betting exchange by a first member to accept terms of an offer of a second member regarding a bet. The method further comprises rejecting the acceptance of the first member if a piece of honor rating software determines that an honor rating of the first member fails to meet an honor rating threshold specified by the second member. The honor rating is recalculated over time by the piece of honor rating software depending on wagering statistics and behaviors of the first member including his refusal to pay on the bet he wagered.

In accordance with further aspects of this invention, a computer-readable medium form of the invention includes a computer-readable medium having computer-executable instructions stored thereon for implementing a computer-implemented method. The method comprises accessing an honor-based betting exchange by a first member to specify new terms different from terms of an offer of a second member regarding a bet. The method further comprises accepting the new terms of the first member if the honor-based betting exchange determines that the new terms are within an acceptable range and if a piece of honor rating software determines that an honor rating of the first member meets an honor rating threshold specified by the second member.

DESCRIPTION OF THE DRAWINGS

The foregoing aspects and many of the attendant advantages of this invention will become more readily appreciated as the same become better understood by reference to the following detailed description, when taken in conjunction with the accompanying drawings, wherein:

FIG. 1 is a block diagram illustrating exemplary pieces of hardware and software for faciliting transactions connected with bets in an exemplary honor-based betting exchange; and

FIGS. 5A-5AR are process diagrams for illustrating exemplary methods for facilitating transactions connected with bets in an exemplary online honor-based betting exchange.

DETAILED DESCRIPTION

FIG. 1 illustrates an exemplary system 100 where honor-based bets are facilitated by an honor-based betting exchange 104. In one embodiment, the honor-based betting exchange 104 works offline when the honor-based betting exchange 104 is disconnected from a network. In a second embodiment, the honor-based betting exchange 104 works online when the honor-based betting exchange 104 is connected to a network, such as the Internet, an online service, or a service that uses modems. In both embodiments, a number of bettors 102a-102c log on to the honor-based betting exchange 104 so as to gain access to it and its pieces of software 106-118.

The honor-based betting exchange 104 facilitates a community where bettors 102a-102c may virtually meet to wager on any events they desire. Bettors 102a-102c become members of the honor-based betting exchange 104 by creating accounts and fund these accounts via the account software 112 so as to bet on various events and to post messages on message boards and blogs maintained by the honor-based betting exchange 104. For a bettor 102a-102c to place a bet, his account must have sufficient funds as managed by the account software 112. Each account can be replenished by suitable financial means, such as by a credit card, a check, or an electronic payment. Bettors 102a-102c who are members of the honor-based betting exchange 104 can wager with any other members. In one embodiment, a bettor can create private betting groups on the honor-based betting exchange 104 to limit wagering to the members of these private betting groups.

Each bet listed (sold) and accepted (purchased) on the honor-based betting exchange 104 is honor-based. In other words, each bet on the honor-based betting exchange 104 is risk-free. As a member of the honor-based betting exchange 104, a losing bettor is not obligated to pay on his losses. In one embodiment, each bettor has an honor rating calculated by the honor rating software 118. In another embodiment, each bettor has an evaluation index that is calculated by a piece of evaluation software (not shown) and the evaluation index is similar to the honor rating, albeit in a different manner. In a further embodiment, each bettor has a credit score that is calculated by a piece of credit worthiness software (not shown) and the credit score is similar to the honor rating or the evaluation index, albeit in a different manner. In all embodiments, the software-calculated honor ratings, evaluation indexes, and credit scores are mechanisms to serve as a policing facility for risk-free betting on the system 100.

In an embodiment where an honor rating is used, each bettor who is a member of the honor-based betting exchange 104 may experience a declining honor rating if other members of the honor-based betting exchange 104 have had negative experiences with him. Viewing it in a different way, the honor-based betting exchange 104 together with other pieces of hardware and software of the system 100, acts as an enforcement mechanism for members.

The honor rating software 118 assigns an honor rating to each member of the honor-based betting exchange 104, preferably on a sliding point scale. This honor rating allows other members to assess the trustworthiness of a member as a potential betting opponent. One suitable point scale includes a 10-point scale, but others may be used. The honor rating software 118 executes one or more mathematical processes that take into account various factors including wagering statistics and behaviors, such as bet amounts; a percentage of the maximum amount a bettor could bet; whether a bettor has a verifiable e-mail address; the feedback scores a bettor receives from other members of the honor-based betting exchange 104; the frequency with which a bettor withdraws or fails to settle bets; and the variation in terms of betting partners that a bettor has had; among many other factors.

There are several types of betting that are facilitated by the honor-based betting exchange 104. One type is where a bettor who lists a bet (a “seller”) dictates terms, such as the odds, rules, amount, and so on, that the seller will accept. Another type is where the seller lists a bet and dictates the terms and the range within each term he would be likely to accept. This latter type is appropriate for situations where other bettors (“buyers”) may not take a bet that is fixed with terms that are unacceptable. This latter type provides flexible terms within which a negotiation ensues to reach terms that are acceptable to both the seller and the buyer.

The honor-based betting exchange 104 allows a seller, such as bettors 102a-102c, to specify those who can accept the listed bet and the amount of money wagered. In a person-to-person scenario, the seller may specify that only one buyer at a particular amount may accept the listed bet. In another scenario, the seller may specify that the listed bet may have one or more buyers at any given amount. For example, in a $500 bet, the seller can list the bet with the bet listing wizard 106 so that 10 buyers can accept up to $50 increments. Alternatively, the seller can set it up so that any number of buyers can specify the amount of money they wish to bet.

When a bettor 102a-102c is ready to list a bet (in the idioms of various embodiments of the present invention, a bettor who lists a bet is a seller who sells a bet), the seller accesses the honor-based betting exchange 104 to access a bet forest 108. The bet forest 108 can be implemented in a database. The database is basically a file composed of records, each containing fields together with a set of operations for searching, sorting, recombining, and other functions. In this particular embodiment, the fields include the classes under which bets are listed and categorized.

Each class of the bet forest 108 includes a set of attributes, which are inherited by all bets listed within that particular class. These attributes help to make bets searchable and sortable within the bet forest 108 by various variables, such as location, which describes a path from a root to a leaf of the bet forest 108; type, which is a taxonomic category for a set of bets, such as whether the winner of the National Spelling Bee will be wearing glasses; and chance, which includes possibility categories of a particular outcome in an uncertain situation among others.

Using the bet forest 108, the seller determines the class under which he would like to list or sell his bet. To list a bet, the seller uses the bet listing wizard 106 to either manually write his own proposition or to automate the drafting of the proposition. The bet listing wizard 106 allows the seller to fill in the blanks in the proposition sentence by activating a pull-down menu to choose nouns, verbs, and numerical values that form the proposition. For example, in the proposition sentence “Vijay Singh will finish in the top 10 of the 2006 Shell Houston Open,” the proper noun “Vijay Singh” is selectable by the seller, the verb “will” is also selectable by the seller, and the numerical value “10” is also selectable by the seller using the bet listing wizard 106. In other words, the seller uses the bet listing wizard 106 to decide what he wants to bet, such as subject, odds, terms, and so on.

The seller also specifies how much he wants to bet. The bet listing wizard 106 works together with the account software 112 to determine the limit with which the seller may bet. In one embodiment, the account software 112 limits the seller to one of two amounts, whichever is greater. The first amount is a suitably fixed monetary amount, such as $100. The second amount is the sum total that the seller has wagered over a suitable period and for which the seller has received suitable feedback scores based on his betting behavior. One suitable period includes 60 days but others may be used. In another embodiment. the above rule for limiting the amount the seller can bet applies to individual transactions. Thus, a bettor who has no history with the system 100 may make bets with greater amounts, but must break up the amount into smaller individual bets. For example, a new bettor using the honor-based betting exchange 104 may not be able to wager $1,000 on a single bet, but he may be able to wager ten bets, each bet amounting to about $100.

The account software 112 checks the funds available to the particular seller, and the seller may not bet more than the funds available in his account. To increase the amount that he may wager, the seller may have to increase the funds in his account. Through the bet listing wizard 106, the seller may also specify a minimum honor rating that a buyer must have to accept the seller's bet. Additionally, the seller may also specify whether he will only accept one buyer or whether the bet is available to many different buyers buying pieces of his bet. When the seller is finished specifying his bet with the bet listing wizard 106, the wizard communicates with the account software 112. The account software 112 debits a listing fee connected with the bet to be listed in the bet forest 108. Moreover, the account software transfers the amount of the bet listed by the seller and a suitable matching fee from the funds in the accounts of the seller into escrow. If the seller decides to withdraw the listed bet from the bet forest 108 before the bet is bought or accepted by a buyer, the withdrawal software 114 helps the seller to remove the listed bet from the bet forest 108 without penalty.

A buyer accesses the honor-based betting exchange 104 to browse the bet forest 108 to search for available bets to wager. Once the buyer finds an available bet, he may accept it if he is eligible to accept the bet. The honor-based betting exchange works together with the account software 112 and the honor rating software 118 to determine whether the buyer is eligible to accept a bet on several suitable bases. One basis is whether the buyer's honor rating is too low, as indicated by the honor rating software 118. Another basis, as indicated by the account software 112, is whether the buyer has sufficient funds in his account to cover a possible loss. A third basis is whether the buyer's bet maximum is lower than the listed bet's minimum amount. The fourth basis is whether the buyer is a new member of the honor-based betting exchange 104 in cases where the listed bet restricts these members from participating. There are many other possible bases.

Once the system 100 determines that the buyer is eligible to accept the bet, the buyer's and the seller's accounts are debited by the amounts proffered. The seller's matching fee is transferred from escrow to an entity that is operating the system 100. The buyer's matching fee is likewise deducted from the buyer's account. In one embodiment, these fees are nonrefundable. In other embodiments, the fees are refundable, depending on the circumstances, by the system 100.

The withdrawal software 114 aids both the seller and the buyer in withdrawing their bets at any time prior to the time the bet is set to expire. The withdrawal software 114 allows a non-withdrawing bettor to give feedback to the withdrawing bettor. The account software 112 notes that the amount withdrawn would not count toward the total wagered amount in a desired period for the purpose of increasing the bet maximum amount.

The settlement software 116 is employed by the system 100 when the seller and the buyer wish to settle a bet. The settlement software 116 can be used when bettors call for a settlement before the settlement date. Two circumstances merit settling before the settlement date. The first circumstance involves when it becomes impossible or nearly impossible for a bettor to win. For example, where a candidate for president dies before the election, it is unlikely that the deceased will be elected president. In this case, none of the bettors, either as seller or buyer, is likely to win. The second circumstance involves when an event occurs sometime before the term date. For example, suppose bettors bet on a certain person to be traded in baseball. The term date is July 15, and the settlement date is July 16. The person of interest gets traded on June 25. Therefore, the bettors can settle the bet much earlier.

The settlement software 116 is used by bettors 102a-102c, either as seller or buyer, for declaration of a win or a loss. In the case where a suitable period has passed after the settlement time, such as 72 hours, and where the first moving bettor claims a loss, the withdrawal software 114 communicates with the account software 112 to transfer the bet amount directly to the winning party's account. The withdrawal software 114 will also automatically increase the honor rating of the losing bettor who claims the loss.

Where after a suitable period, such as 72 hours after the settlement time, and where the first moving bettor claims a win, that bettor will be caused to wait by the settlement software 116. If the settlement software 116 determines that the opposing bettor claims a loss (in other words, he agrees with the opponent's assessment), the settlement software 116 causes the account software 112 to transfer the bet amount directly to the winning party's account. Otherwise, if the opposing bettor claims a win, the settlement software 116 notifies both bettors of the conflicting conclusion and indicates both bettors to come to a resolution using a bet message board provided by the honor-based betting exchange 104.

If the opposing bettor does nothing in response to the other bettor claiming a win, the settlement software 116 assumes that the opposing bettor agrees by silence that he has lost and communicates with the account software 112 to transfer the amount bet to the winning party's account. If more than a certain period has passed after the settlement time, the settlement software 116 waits for the first moving bettor's declaration of the outcome and assumes that the non-moving party, by silence, agrees to be bound by the opponent's declaration. In this circumstance, the settlement software 116 communicates with the account software 112 to transfer the bet amount directly to the party who declares a win. In the situation where neither bettor acts to settle the bet within a desired period, such as within 72 hours of settlement time, each bettor's rights to enter into new bets in the system 100 are suspended by the honor-based betting exchange 104 until the bet is resolved.

Members of the community facilitated by the honor-based betting exchange 104 are not obligated to pay on their losses. As a bettor sells, buys, and settles his bets, feedback from others regarding the transaction positively affects or negatively affects his honor rating. Negative feedback may cause an honor rating of a bettor to fall. Individual feedback scores are within a suitable range, such as 0 to 3. Other ranges are possible. In one embodiment, winning bettors may not leave feedback where their opponent moved first and claimed a loss. The honor-based betting exchange 104 automatically assigns the losing bettor the maximum feedback score, such as a 3 in this scenario. In another embodiment, if a bettor does not leave feedback on his opponent within a suitable period, such as within 30 days of the bet settlement time, the honor-based betting exchange 104 automatically assigns the maximum score, such as a 3.

FIGS. 5A-5AR illustrate a method 5000 for facilitating transactions connected with bets on an online honor-based betting exchange using pieces of software. The method allows bettors to search a bet forest to locate a class with which to place or list a bet and for others to accept a listed bet. All bets are risk free in that a losing bettor is not obliged to pay on his losses; however, his behaviors in the betting process on the honor-based betting exchange are captured in his honor rating. From a start block, the method 5000 proceeds to a set of method steps 5002, defined between a continuation terminal (“Terminal A”) and an exit terminal (“Terminal B”). The set of method steps 5002 describe updating a bet forest, such as the bet forest 108, which comprises trees, each branch of the trees being a bet class extending into leaves at which bets are listed. As would be appreciated by one skilled in the art, the classes described below are for illustrative purposes. Other classes not mentioned here may be suitably used and some of the mentioned classes need not be used. Even the organization of the classes can be changed from the organization discussed below.

From Terminal A (FIG. 5C), the method 5000 proceeds to block 5014 where the method checks for updates to bet classes, such as public interest and private interest, which are at the roots of the bet forest 108. At block 5016, under the bet class public interest, the method 5000 checks for updates to bet sub-classes, such as arts and entertainment; business and finance; news; and sports. Next, at block 5018, under the bet sub-class arts and entertainment, the method checks for updates to bet sub-classes movies; television; music; books; magazines; and literature. The method 5000 proceeds to block 5022 where under the bet sub-class movies, the method checks for updates to bet sub-classes awards; box office takes; and others. At block 5024, under the bet sub-class movies/awards, the method checks for updates to bet sub-classes Academy Awards; Golden Globe Awards; and Screen Actors Guild awards. Next, at block 5026, under the bet sub-class movies/box office takes, the method checks for updates to bet sub-classes openings; second week take; and others. The method then proceeds to a continuation terminal (“Terminal A1”).

From Terminal A1 (FIG. 5D), the method 5000 proceeds to block 5028 where under bet sub-class television, the method checks for updates to bet sub-classes awards; ratings; and reality TV. At block 5030, under reality TV, updates are checked for various sub-classes (such as Apprentice, The; Bachelor, The; Bachelorette, The; Big Break, The; Big Brother; Survivor; Amazing Race, The). Next, at block 5032, under bet sub-class music, the method checks for updates to bet sub-class awards. Next, at block 5034, under bet sub-class music/awards, the method checks for updates to bet sub-classes Grammy Awards; MTV Video Music Awards; and American Music Awards. The method proceeds to block 5036 where under the bet sub-class celebrities, the method checks for updates to bet sub-classes divorces and splits; deaths; and others. At block 5038, under the bet sub-class business and finance, the method checks for updates to bet sub-classes markets and investing, such as stocks. Next, at block 5040, under the bet sub-class business and finance/markets, the method checks for updates to bet sub-classes NYSE; NASDAQ; AMEX; and S&P. The method then continues to another continuation terminal (“Terminal A2”).

From Terminal A2 (FIG. 5E), the method 5000 proceeds to block 5042 where under the bet sub-class business and finance/investing, the method checks for updates to bet sub-classes real estate; interest rates; companies; and commodities. At block 5044, under the bet sub-class news, the method checks for updates to bet sub-classes current events; weather; law; politics; international; society and culture; and science and technology. At block 5046, under bet sub-class news/current events, the method checks for updates to bet sub-classes crime and trials; and others. The method 5000 then proceeds to block 5048 where under bet sub-class news/law, the method checks for updates to bet sub-classes Supreme Court; and others. At block 5050, under the bet sub-class news/politics, the method checks for updates to bet sub-classes elections; appointments and nominations; Congressional votes; and others. Next, at block 5052, under the bet sub-class politics/elections, the method checks for updates to bet sub-classes 2006 U.S. Senate elections; 2008 U.S. Presidential election; and others. The method then proceeds to block 5054 where under the bet sub-class politics/appointments and nominations, the method checks for updates to bet sub-classes U.S. Supreme Court; President's Cabinet; and others. The method then proceeds to another continuation terminal (“Terminal A3”).

From Terminal A3 (FIG. 5F), the method 5000 proceeds to block 5056 where under the bet sub-class news/international, the method checks for updates to bet sub-classes Iraq War; and others. At bock 5058, under the bet sub-class sports, the method checks for updates to bet sub-classes baseball (MLB); boxing; hockey (NHL); auto racing; golf; basketball; football; and others. At block 5060, under bet sub-class baseball (MLB), the method checks for updates to bet sub-classes 2006 season; players and managers; and teams. The method then proceeds to block 5062 where under bet sub-class baseball/2006 season, the method checks for updates to bet sub-classes awards; division races; playoffs; regular season games; World Series; and others. At block 5064, under bet sub-class baseball/players and managers, the method 5000 checks for updates to bet sub-classes trades; releases and firings; and others. Next, at block 5068, under bet sub-class baseball/teams, the method checks for updates to bet sub-classes American League; and National League. The method proceeds to block 5070 where under bet sub-class hockey, the method checks for updates to bet sub-classes 2005-06 season; players and coaches. The method then continues to another continuation terminal (“Terminal A4”).

From Terminal A4 (FIG. 5G), the method 5000 proceeds to block 5072 where under the bet sub-class hockey/2005-06 season, the method checks for updates to bet sub-classes awards; division races; NHL draft; Stanley Cup playoffs; regular season games; and others. At block 5074, under the bet sub-class hockey/players and coaches, the method checks for updates to bet sub-classes players; and coaches. Next, at block 5076, under bet sub-class hockey/teams, the method checks for updates to bet sub-classes Western Conference; and Eastern Conference. The method proceeds to block 5078 where under bet sub-class sports/others, the method checks for updates to bet sub-classes horse racing; tennis; Olympics; soccer; and other sports. At block 5080, under bet sub-class horse racing, the method checks for updates to bet sub-classes Kentucky Derby, the; Belmont Stakes, the; Preakness, the; and others. Next, at block 5082, under bet sub-class sports/auto racing, the method checks for updates to bet sub-classes Indy Car; NASCAR; and others. The method proceeds to block 5084 where under bet sub-class NASCAR, the method checks for updates to bet sub-classes Nextel Cup; and Busch Series. The method continues at another continuation terminal (“Terminal A5”).

From Terminal A5 (FIG. 5H), the method proceeds to block 5086 where under bet sub-class sports/golf, the method checks for updates to bet sub-classes PGA Tour; LPGA Tour; Champion Tour; Nationwide Tour; and others. At block 5088, under the bet sub-class PGA Tour, the method checks for updates to bet sub-classes world ranking; Ryder and President Cup; 2006 PGA Tour season; and others. Next, at block 5090, under bet sub-class LPGA Tour, the method checks for updates to bet sub-classes awards; money lists; players; tournaments; and others. The method proceeds to block 5092 where under bet sub-class sports/basketball, the method checks for updates to bet sub-classes NBA; NCAA; and WNBA. At block 5094, under bet sub-class NBA, the method checks for updates to bet sub-classes 2005/06 season; teams; and players and coaches. Next, at block 5096, under bet sub-class NCAA, the method checks for updates to bet sub-classes men's; and women's. The method proceeds to block 5098 where under bet sub-class sports/football, the method checks for updates to bet sub-classes NCAA; and NFL. The method continues at another continuation terminal (“Terminal A6”).

From Terminal A6 (FIG. 5I), the method 5000 proceeds to block 5100 where under bet sub-class NFL, the method checks for updates to bet sub-classes 2005 season; teams; and players and coaches. At block 5102, under the bet class private interests, the method checks for updates to bet sub-classes sports; business; relationships; and others. The method then continues to exit Terminal B. Various classes and sub-classes have been discussed, but these are mere illustrations and there can be many more suitable classes and sub-classes not mentioned above. Various embodiments of the present invention are not limited to the above-described classes and sub-classes but can include any classes and sub-classes on which bettors may list or accept bets.

From Terminal B (FIG. 5A), the method proceeds to a set of method steps 5004, defined between a continuation terminal (“Terminal C”) and an exit terminal (“Terminal D”). The set of method steps 5004 describes that a bettor, such as bettors 102a-102c, who wishes to list a bet, browses through the bet forest 108 to find a branch at which to list a bet.

From Terminal C (FIG. 5I), a person listing a bet (bet seller) finds an honor-based betting exchange, such as the honor-based betting exchange 104, on the Internet (e.g., using a suitable uniform resource locator). At block 5106, the bet seller browses through the bet forest, such as the bet forest 108, by classes, such as public interest or private interest, and among many sub-classes to find a location at which to list a bet. The bet forest 108 is searchable and sortable across many different dimensions. For example, the bet seller may find a location at which to list a bet using a path, such as the following path: “public interest>sports>PGA Tour>2006 season>regular events>Shell Houston Open>player performances>player finish (over/under).” Thus, location is one dimension. Another suitable dimension is to search or sort by type: mainstream type, such as bets which particulars are recognized, are conventional, or are established for particular subject matter; exotic, such as bets which particulars depart from those recognized, conventional, or established for bets of particular subject matter; kinda, such as an opening coin toss in a football game; somewhat, such as the person who kicks the first field goal in a football game; or extremely, such as whether the winner of the National Spelling Bee will be wearing glasses once he spells the winning word. Chance is another dimension, which is based on the level of skill: high, such as coin tosses for which no amount of research or preparation by a bettor will make a difference in his chance; medium, such as bets that have some degree of chance; and low, such as bets for which some knowledge is helpful (point spreads in a football game among other things). The method 5000 then continues to another continuation terminal (“Terminal C2”).

From Terminal C2 (FIG. 5J), the method proceeds to decision block 5110 where a test is performed to determine whether the bet seller has found a bet sub-class to list a bet. If the answer to the question at decision block 5110 is YES, the method continues to another continuation terminal (“Terminal C3”). Otherwise, the method proceeds to another continuation terminal (“Terminal C1”). From Terminal C1 (FIG. 5I), the method 5000 skips to block 5106 where the above-identified processing steps are repeated.

From Terminal C3 (FIG. 5K), the bet seller selects a hyperlink indicating an intention to list a bet with the honor-based betting exchange on a Web page presented to the bet seller by the honor-based betting exchange 104. At decision block 5114, a test is performed to determine whether the bet seller is a member of the honor-based betting exchange. If the answer to the test at decision block 5114 is YES, the method 5000 proceeds to another continuation terminal (“Terminal C4”). If the answer to the test at decision block 5114 is NO, the method proceeds to block 5116 where the honor-based betting exchange, at the bet seller's request, creates an account for the bet seller. The bet seller provides identifying information including an alias and a password, and finds the account by various financial methods, such as by credit card. Next, at block 5120, the honor-based betting exchange sets the honor rating of the newly created account to a suitable level, such as zero, and sets the betting limit to a suitable amount, such as $100. Other suitable levels and other suitable amounts may be used. The method then proceeds to Terminal C4.

From Terminal C4 (FIG. 5L), the method 5000 proceeds to block 5122 where the bet seller selects a characteristic of the bet, the characteristic being a “nail it down” bet; or a “negotiable” bet. A nail-it-down bet is where a bettor who lists a bet (a “seller”) dictates terms, such as the odds, rules, amount, and so on, that the seller will accept. A negotiable bet is where the seller lists a bet and dictates the terms and the range within each term he would be likely to accept. The method proceeds to decision block 5124 where a test is performed to determine whether the selected characteristic is a nail-it-down bet. If the answer to the test at decision block 5124 is NO, the method 5000 proceeds to another continuation terminal (“Terminal C5”). Otherwise, if the answer is YES to the test at decision block 5124, the method proceeds to block 5126 where the bet listing wizard 106, such as a natural language tool, appears to help the bet seller write a bet proposition sentence (which the user can opt out of and draft by freehand). At block 5128, the bet seller specifies the verb of the bet and the object of the bet. Next, at block 5130, the bet seller specifies the odds of the bet and the amount of the bet. The method then continues to another continuation terminal (“Terminal C6”).

From Terminal C5 (FIG. 5M), the method 5000 proceeds to decision block 5132 where a test is performed to determine whether the selected characteristic is a negotiable bet. If the answer to the test at decision block 5132 is NO, the method proceeds to Terminal C4 where the above-identified processing steps are repeated. Otherwise, if the answer to the test at decision block 5132 is YES, the method proceeds to block 5134 where the bet listing wizard 106, such as a natural language tool, appears to help the bet seller write a bet proposition sentence. The bet seller specifies the verb of the bet and the object of the bet at block 5136. Next, at block 5138, the bet seller specifies the odds of the bet and a range of acceptable odds. The method proceeds to block 5140 where the bet seller specifies the amount of the bet and the range of acceptable amounts. At block 5142, the bet seller specifies other objects of the bet, such as point spread, and the range of acceptable values of these objects. The method then continues to Terminal C6.

From Terminal C6 (FIG. 5N), the method 5000 proceeds to block 5144 where the bet seller specifies through the method the number of bet buyers who can accept the bet. At decision block 5146, a test is performed to determine whether the bet seller specifies only one bet buyer. If the answer to the test at decision block 5146 is YES, the method 5000 proceeds to another continuation terminal (“Terminal C7”). Otherwise, if the answer to the test at decision block 5146 is NO, another decision block 5148 is entered in which a test is performed to determine whether the bet seller specifies only a fixed number of buyers. If the answer to the test at decision block 5148 is YES, the method 5000 proceeds to block 5150 where the bet seller specifies a fixed number of bet buyers at a fixed betting amount. The method then continues to Terminal C7. If the answer to the test at decision block 5148 is NO, the method 5000 proceeds to block 5152 where the bet seller specifies a variable number of buyers for varying betting amounts. The method then continues to Terminal C7.

From Terminal C7 (FIG. 5O), the method 5000 proceeds to block 5154 where the method calculates the bet seller's maximum wager amount, which is a sum of all bets he had concluded over a certain time period, such as within 60 days. At decision block 5146, the method 5000 performs a test to determine whether the bet amount to be listed is greater than the maximum wager amount. If the answer to the test at decision block 5146 is YES, the method 5000 prompts the bet seller to specify a lower amount through the honor-based betting exchange 104. See block 5148. If the answer to the test at decision block 5146 is NO, the method proceeds to decision block 5150 where a test is performed to determine whether the bet seller has bet more than the funds in his account. If the answer to the test at decision block 5150 is YES, the method proceeds to block 5152 where the method 5000 prompts the bet seller to increase the funds in his account. Otherwise, if the answer to the test at decision block 5150 is NO, the method continues to another continuation terminal (“Terminal C8”).

From Terminal C8 (FIG. 5P), the bet seller sets an honor rating threshold for bet buyers who may accept the bet. See block 5154. At block 5156, the bet seller specifies (and a default is provided by the method if none is specified) a closing time after which no more offers or counteroffers will be accepted. The method 5000 proceeds to block 5158 where the bet seller specifies a settlement time (which cannot be less than a suitable time period, such as 72 hours) for the bettor to settle the bet before betting privileges are suspended. The method continues to exit Terminal D.

From Terminal D, the method 5000 proceeds to a set of method steps 5006, defined between a continuation terminal (“Terminal E”) and an exit terminal (“Terminal F”). The set of method steps 5006 describe the execution of a matching algorithm to eliminate the possibility of overlapping listings.

From Terminal E (FIG. 5P), the method 5000 proceeds to block 5160 where the method 5000 searches for another bet that may be a match to the bet to be listed by the bet seller. At block 5162, the method 5000 looks at bet sentences whose difference is a mutually exclusive subject. The method then continues to another continuation terminal (“Terminal E I”).

From Terminal E1 (FIG. 5Q), the method 5000 proceeds to decision block 5164 where a test is performed to determine whether there is a match. If the answer to the test at decision block 5164 is YES, the method continues to another continuation terminal (“Terminal C9”). If the answer to the test at decision block 5164 is NO, the method continues to block 5166 where the method 5000 looks at bet sentences whose difference is a mutually exclusive object (e.g., scores). The method then proceeds to decision block 5168 to determine whether there is a match. If the answer is YES to the test at decision bock 5168, the method continues to Terminal C9. Otherwise, if the answer to the test at decision block 5168 is NO, the method 5000 looks at bet sentences whose difference is an object whose range of values is specified by another object. See block 5170. The method then continues to another continuation terminal (“Terminal E2”).

From Terminal E2 (FIG. 5R), the method 5000 proceeds to decision block 5172 where a test is performed to determine whether there is a match. If the answer to the test at decision block 5172 is YES, the method continues to Terminal C9. Otherwise, if the answer to the test at decision block 5172 is NO, the method continues to another continuation terminal (“Terminal C10”).

From Terminal C9 (FIG. 5R), the method 5000 proceeds to decision block 5174 where a test is performed to determine whether the bet seller still wishes to list his own bet. If the answer to the test at decision block 5174 is YES, the method proceeds to Terminal C10. Otherwise, if the answer is NO to the test at decision block 5174, the method 5000 proceeds to block 5176 where the method presents the matched bet for the bet seller to consider betting. The method then continues to exit Terminal F. One example of a match includes the following bet sentence, “Vijay Singh will finish in the top five of the Shell Houston Open.” Another bet seller has already listed the following bet sentence, “Vijay Singh will not finish in the top five of the Shell Houston Open.” In this particular case, the system 100 will make a suggestion to the bet seller that he look at the second bet sentence before listing his own.

From Terminal C10 (FIG. 5S), the amount of the seller's bet is deducted from his account and put into a bet escrow connected with a listed bet. See block 5178. At block 5180, the bet seller is charged a listing fee for listing a bet in a particular category. Additionally, a matching fee is also removed from the bet seller's account and put into escrow connected with the listed bet. The method 5000 then proceeds to decision block 5182 where a test is performed to determine whether the seller wishes to up-sell to other categories. If the answer to the test at decision block 5182 is NO, the method continues to exit Terminal F. Otherwise, if the answer to the test at decision block 5182 is YES, the method 5000 proceeds to block 5184 where the bet seller specifies one or more categories to up-sell so as to bring higher visibility to his bet. At block 5186, the method charges a fee for up-selling the bet to one or more categories. The method continues to exit Terminal F.

From exit Terminal F, the method 5000 proceeds to another continuation terminal (“Terminal G”). From Terminal G (FIG. 5B), the method 5000 proceeds to a set of method steps 5008, defined between a continuation terminal (“Terminal H”) and an exit terminal (“Terminal I”). The set of method steps 5008 describes another person, who is a bet buyer, as he browses through the bet forest to find one or more bets to wager.

From Terminal H (FIG. 5T), a person wishing to bet (bet buyer) finds an honor-based betting exchange, such as the honor-based betting exchange 104, on the Internet (e.g., using a suitable uniform resource locator). At block 5190, the bet buyer browses through a bet forest, such as the bet forest 108, to find a desired bet listing. Next, at block 5108, the bet buyer browses through the bet forest by suitable event times, such as today's events; events in the next seven days; next 30 days; ongoing events; and other future events. Other suitable events divided by time are possible. At bock 5192, the bet buyer browses through the bet forest by suitable betting amounts, such as up to $50; between $51 and $100; between $101 and $250; between $251 and $500; between $501 and $1,000; and over $1,000. Other suitable amounts are possible. At block 5194, the bet buyer browses through the bet forest by suitable odds, such as 1:20 and lower; between 1:10 and 1:19; between 1:5 and 1:9; between 1:1 and 1:5; 1:1; between 1:1 and 5:1; between 5:1 and 9:1; between 10:1 and 19:1; between 20:1 and higher. Other suitable odds are possible. At block 5196, the bet buyer browses through the bet forest by the closing time of bets, such as within the hour; today; or this week. Other suitable closing times are possible. At block 5198, the bet buyer browses through the bet forest by suitable attributes, such as by subject; by type (staples, exotics, somewhat, very); by chance (high, medium, low); and by gender interest (him, her, everyone). Other suitable attributes are possible. At block 5200, the bet buyer browses through the bet forest by suitable events, such as big events, everyday events, and events that are off the beaten path. Other suitable events are possible. The method then continues to another continuation terminal (“Terminal H0”).

From Terminal H0 (FIG. 5U), the method 5000 proceeds to decision block 5202 where a test is performed to determine whether the bet buyer has found a desired bet listing. If the answer to the test at decision block 5202 is NO, the method continues to another continuation terminal (“Terminal H1”). The method then skips to block 5190 (FIG. 5T) where the above-identified processing steps are repeated. If the answer to the test at decision block 5202 is YES, the method 5000 proceeds to block 5204 where the bet buyer selects the bet and the method brings the bet buyer to a product page detailing the bet on the honor-based betting exchange 104. At block 5206, if various terms of the bet are negotiable, the bet buyer can select alternative values from a dropdown menu for these various terms. Collectably, these terms constitute a counteroffer by the bet buyer. The method 5000 then continues to another continuation terminal (“Terminal H2”).

From Terminal H2 (FIG. 5V), the method 5000 proceeds to decision block 5208 where a test is performed to determine whether the counteroffers are acceptable to the bet seller. If the answer to the test at decision block 5208 is NO, the method 5000 proceeds to Terminal H1 and skips back to block 5190 where the above-identified processing steps are repeated. If the answer to the test at decision block 5208 is YES, the method continues to another decision block 5210 where another test is performed to determine whether the bet buyer accepts the bet. If the answer to the test at decision block 5210 is NO, the method 5000 proceeds to Terminal H1 and skips back to block 5190 where the above-identified processing steps are repeated. Otherwise, if the answer to the test at decision block 5210 is YES, the method continues to decision block 5212 where a third test is performed to determine whether the bet buyer has sufficient finds in his account. If the answer to the test at decision block 5212 is NO, the method continues to another continuation terminal (“Terminal H3”). If the answer to the test at decision block 5212 is YES, the method continues to another continuation terminal (“Terminal H5”).

From Terminal H3 (FIG. 5W), the method continues to block 5214 where the bet buyer is requested to increase the funds available in his account. The method then continues to another continuation terminal (“Terminal H4”) and skips back to block 5212 (FIG. 5V), where the above-identified processing steps are repeated.

From Terminal H5 (FIG. 5W), the method 5000 proceeds to decision block 5216 where a test is performed to determine whether the bet buyer's bet amount exceeds a limit on the account. If the answer to the test at decision block 5216 is YES, the method continues to block 5218 where the method requests the bet buyer to choose another bet with a lower amount threshold. The method then continues to Terminal H1 and skips back to block 5190 where the above-identified processing steps are repeated. Otherwise, if the answer to the test at decision block 5216 is NO, the method proceeds to block 5220, and the buyer's bet amount is deducted from his account and put into the escrow connected with the bet. The method 5000 also takes a matching fee from the account of the bet buyer. See block 5222. Alternatively in another embodiment, the method takes a pro rata percentage of the overall value of the bet as a matching fee in another embodiment. The method 5000 then proceeds to exit Terminal I.

From exit Terminal I (FIG. 5B), the method 5000 proceeds to a set of method steps 5010, defined between a continuation terminal (“Terminal J”) and an exit terminal (“Terminal K”). The set of method steps 5010 describes the determination of whether there has been a withdrawal of a bet from either the seller or the buyer.

From Terminal J (FIG. 5X), the method 5000 proceeds to decision block 5224 where a test is performed to determine whether the bet seller wishes to cancel the bet. If the answer to the test at decision block 5224 is NO, the method 5000 proceeds to another continuation terminal (“Terminal J1”). Otherwise, if the answer to the test at decision block 5224 is YES, another decision block is entered where another test is performed to determine whether there has been an acceptance of the bet. See decision block 5226. If the answer to the test at decision block 5226 is YES, the method continues to another continuation terminal (“Terminal J2”). Otherwise, if the answer to the test at decision block 5226 is NO, the method continues to block 5228 where the method removes the bet from the bet forest. At block 5230, the method returns the bet amount to the bet seller, but the listing fee is still charged. The method then continues to another continuation terminal (“Terminal L6”).

From Terminal J1 (FIG. 5Y), the method 5000 proceeds to decision block 5232 where a test is performed to determine whether the bet buyer wishes to cancel the bet. If the answer to decision block 5232 is NO, the method continues to exit Terminal K. Otherwise, if the answer to the test at decision block 5232 is YES, another decision block is entered and a test is performed to determine whether the closing time has expired. See decision block 5234. If the answer to the test at decision block 5234 is YES, the method continues to Terminal J2. Otherwise, if the answer to the test at decision block 5234 is NO, the method continues to block 5236 where the method returns the bet amount to the buyer but charges a matching fee, as well as assigning the minimum feedback index, such as 0, to the withdrawing buyer. At block 5238, the bet seller's bet remains in the bet forest and his matching fee is kept for a potential match.

From Terminal J2 (FIG. 5Z), the method 5000 proceeds to decision block 5240 where a test is performed to determine whether the seller is withdrawing. If the answer to the test at decision block 5240 is YES, the method removes the bet from the bet forest and assigns the minimum feedback index (such as zero) to the withdrawing seller. See block 5242. The method then continues to another continuation terminal (“Terminal J3”). If the answer to the test at decision block 5240 is NO, the method continues to decision block 5244 where a test is performed to determine whether the buyer is withdrawing. If the answer to the test at decision block 5244 is YES, the method assigns the minimum feedback index, such as zero, to the withdrawing buyer. See block 5246. Otherwise, if the answer to the test at decision block 5244 is NO, the method returns the bet amount, but not the fees incurred, such as the matching fee. See block 5248. The method then continues to Terminal L6. From block 5242, the method 5000 proceeds to Terminal J3 and skips to block 5248 where the processing steps are repeated. From exit Terminal K (FIG. 5B), the method 5000 proceeds to a set of method steps 5012, defined between a continuation terminal (“Terminal L”) and an exit terminal (“Terminal M”). The set of method steps 5012 describe the monitoring of the resolution of the bet by the bet seller and the bet buyer.

From Terminal L (FIG. 5AA), the method 5000 proceeds to decision block 5250 where a test is performed to determine whether the settlement period has expired. If the answer to the test at decision block 5250 is YES, the method continues to another continuation terminal (“Terminal L3”). Otherwise, if the answer to the test at decision block 5250 is NO, the method continues to another decision block where another test is performed to determine whether a bettor has declared “I lost.” See decision block 5252. If the answer to the test at decision block 5252 is NO, the method continues to another continuation terminal (“Terminal L1”). If the answer to the test at decision block 5252 is YES, the method 5000 proceeds to block 5254 where the method transfers the escrow amount to the winning bettor's account. At block 5256, the method 5000 automatically assigns the maximum feedback index, such as 3, to the losing bettor, which is helpful in an honor rating calculation. The method then continues to another continuation terminal (“Terminal L5”).

From Terminal L1, (FIG. 5AB), the method 5000 proceeds to decision block 5258, where a test is performed to determine whether a bettor has declared “I won.” If the answer to the test at decision block 5258 is NO, the method continues to Terminal L and skips back to decision block 5250 where the above-identified processing steps are repeated. If the answer to the test at decision block 5258 is YES, the method continues to decision block 5260 where another test is performed to determine whether the other bettor has declared “I lost.” If the answer to the test at decision block 5260 is NO, the method continues to another continuation terminal (“Terminal L2”). If the answer to the test at decision block 5260 is YES, the method transfers the escrow amount to the winning bettor's account. See block 5262. At block 5264, the method automatically assigns the maximum feedback index such as 3 to the losing bettor, which is helpful in an honor rating calculation. The method then continues to another continuation terminal (“Terminal L5”).

From Terminal L2 (FIG. 5AC), the method 5000 proceeds to decision block 5266 where a test is performed to determine whether a time period beyond the settlement period has expired, such as 72 hours. If the answer to the test at decision block 5266 is NO, the method proceeds to another continuation terminal (“Terminal L4”). From Terminal L4 (FIG. 5AB) the method proceeds to decision block 5260, where the above-identified processing steps are repeated. Otherwise, if the answer to the test at decision block 5266 is YES, the method proceeds to decision block 5268, where a test is performed to determine whether the silent bettor objected to a transfer of the escrow amount. If the answer to the test at decision block 5268 is YES, the method proceeds to block 5270 where the method marks the bettor as unwilling to settle a bet for later rating analysis and communicates with both the bet seller and the bet buyer to settle the bet outside of the system 100. The method then continues to terminal L6. If the answer to the test at decision block 5268 is NO, the method transfers the escrow amount to the winning bettor's account and assigns the lowest feedback index, such as zero, to the losing bettor. See block 5272. The method then continues to Terminal L6.

From Terminal L3 (FIG. 5AD) the method 5000 proceeds to decision block 5274 where a test is performed to determine whether a bettor has declared that “I won.” If the answer to the test at decision block 5274 is NO, the method then proceeds to Terminal L3 where the above-identified processing steps are repeated. If the answer to the test at decision block 2574 is YES, the method proceeds to decision block 5276 where a test is performed to determine whether the silent bettor objected to a transfer of the escrow amount. If the answer to the test at decision block 2576 is YES, the method at block 5278 marks the bettor as unwilling to settle a bet for later rating analysis and communicates with both the bet seller and the bet buyer to settle their bet outside of the system 100. The method 5000 then proceeds to terminal L6. If the answer to the test at decision block 5276 is NO, the method at block 5280 transfers the escrow amount to the winning bettor's account. The method then proceeds to terminal L6.

From Terminal L5 (FIG. 5AE), the method 5000 proceeds to decision block 5282, where a test is performed to determine whether the losing bettor has provided feedback to the winner. If the answer to the test at decision block 5282 is YES, the method records the feedback points provided by the losing bettor to the winning bettor. See block 5284. The method then continues to Terminal L6. If the answer to the test at decision block 5282 is NO, the method continues to decision block 5286 where another test is performed to determine whether a default period of time has expired. If the answer to the test at decision block 5286 is YES, the method assigns the winning bettor with the maximum feedback index, such as 3. See block 5288. The method then continues to Terminal L6. If the answer to the test at decision block 5286 is NO, the method continues to Terminal L5 and skips back to decision block 5282 where the above-identified processing steps are repeated.

From Terminal L6 (FIG. 5AF), the method 5000 proceeds to decision block 5290 where a test is performed to determine whether it is time to recalculate a bettor's honor rating. If the answer to the test at decision block 5290 is NO, the method continues to Terminal C and skips back to block 5104 (FIG. 5I) where the above-identified processing steps are repeated. Otherwise, if the answer to the test at decision block 5290 is YES, the method continues to decision block 5292 where a test is performed to determine whether history shows that the bettor made at least five bets. If the answer to the test at decision block 5292 is NO, the method continues to another continuation terminal (“Terminal L8”). Otherwise, if the answer to the test at decision block 5292 is YES, the method continues to block 5294, where, for the most recent bets (such as five bets), the method takes the product formed from an amount and the feedback index connected with the bet. At block 5296, each product is summed by the method 5000 to form received feedback points. The method then continues to another continuation terminal (“Terminal L7”).

From Terminal L7 (FIG. 5AG), the method 5000 proceeds to block 5298 where for the most recent bets, such as five bets, the method takes the product formed from a bet amount and the maximum possible feedback index, and each product is summed at block 5300 by the method to form possible feedback points. At block 5302, the method calculates a quotient formed from the received feedback points (as a dividend), and the possible feedback points (as a divisor). At block 5304, the method calculates a first summand for the last five bets multiple by taking a product from a last five average range value and the above quotient. The method at block 5306 calculates a second summand by using a last five average minimum value. At block 5308, a sum representing the last five bets multiple is calculated using the first and second summand. The method 5000 then proceeds to another continuation terminal (“Terminal L8”).

From Terminal L8 (FIG. 5AH), the method 5000 proceeds to decision block 5310 where a test is performed to determine whether the e-mail address of the bettor can be verified. If the answer to the test at decision block 5310 is NO, the method assigns a minimum value, such as 0, to the e-mail verification factor. See block 5312. The method then continues to another continuation terminal (“Terminal L9”). If the answer to the test at decision block 5310 is YES, the method proceeds to block 5314 where the method assigns a maximum value (such as 2) to the e-mail verification factor. The method 5000 continues to Terminal L9.

From Terminal L9 (FIG. 5AI) the method 5000 proceeds to block 5316 where, for all bets ever taken by the bettor, the method takes a product formed from an amount of each bet and the maximum possible feedback index. At block 5318, each product is summed by the method to form the total possible feedback points. Next, at block 5320, for all bets ever taken by the bettor, the method takes a product formed from an amount of each bet and the received feedback index. Each product is then summed by the method to form the total received feedback points. See block 5322. At block 5324, the method calculates a quotient formed from the total received feedback points (as a dividend) and the total possible feedback points (as a divisor). Next, at block 5326, the quotient is labeled as the feedback average. The method 5000 then continues to another continuation terminal (“Terminal L10”).

From Terminal L10 (FIG. 5AJ), the method proceeds to block 5328 where the method counts the number of “zero” instances of feedback received by the bettor. At block 5330, the method counts the total number of bets historically placed by the bettor. The method then calculates a quotient formed from the number of “zero” instances of feedback (as a dividend) and the number of bets historically placed (as a divisor). See block 5332. The method proceeds to block 5334 where the method calculates a welch product formed from the quotient and a welch factor. At block 5336, the method counts the number of withdrawals by the bettor. The method 5000 then counts the total number of bets historically placed by the bettor. See block 5338. The method 5000 proceeds to block 5340 where the method calculates a quotient formed from the number of withdrawals (as a dividend) and the number of bets historically placed (as a divisor). At block 5342, the method calculates a withdrawal product formed from the quotient and a withdrawal factor. The method 5000 then continues to another continuation terminal (“Terminal L1”).

From Terminal L11 (FIG. 5AK), the method 5000 proceeds to block 5344 where the method calculates a weighted sum formed from the welch product and the withdrawal product. At block 5346, the method calculates a combined welch/withdrawal product by using the weighted sum as a multiplicand and a combined welch/withdrawal factor as another multiplicand. The method 5000 calculates a welch/withdrawal sum formed from the welch factor and the withdrawal factor. See block 5348. At block 5350, the method calculates a quotient formed from the combined welch/withdrawal product (as a dividend) and the welch/withdrawal sum (as a divisor). At block 5352, the method labels the resulting quotient as welch/withdrawal multiple. The method 5000 continues to another continuation terminal (“Terminal L12”).

From Terminal L12 (FIG. 5AL), the method 5000 proceeds to block 5354 where the method calculates the number of different betting partners the bettor has associated with over his history of using the exchange. At block 5356, the method calculates the number of bets the bettor has placed using the exchange. The method then calculates a quotient formed from the number of different betting partners (as a dividend) and the number of bets (as a divisor). See block 5358. The method then proceeds to block 5360 where the method determines a betting partner variety factor. At block 5362, the method calculates a product formed from the quotient and the betting partner variety factor. The method 5000 then labels the resulting product as a betting partner variety score. See block 5364. The method 5000 then continues at another continuation terminal (“Terminal L13”).

From Terminal L13 (FIG. 5AM), the method 5000 proceeds to block 5366 where the method calculates a maximum sum where each summand of the sum is the maximum bet that the bettor could have placed in his betting history on the honor-based betting exchange. At block 5368, the method calculates an actual sum where each summand of the sum is the actual bet amount that the bettor placed in his betting history. The method then calculates a quotient formed from the actual sum (as a dividend) and the maximum sum (as a divisor). See block 5370. The method proceeds to block 5372 where the method determines an aggressiveness factor. At block 5374, the method calculates a product formed from the quotient and the aggressiveness factor. The method then labels the resulting product as an aggressiveness quotient. See block 5376. The method 5000 then continues to another continuation terminal (“Terminal L14”).

From Terminal L14 (FIG. 5AN), the method 5000 proceeds to block 5378 where the method calculates a number of settled bets that the bettor resolved quickly, such as within 24 hours, in his betting history on the honor-based betting exchange. At block 5380, the method calculates the total number of bets that the bettor has placed in his betting history on the honor-based betting exchange. The method then calculates a settled quotient formed from the number of settled bets (as a dividend) and the total number of bets (as a divisor). See block 5382. The method 5000 proceeds to block 5384 where the method calculates a number of bets that the bettor was the first to settle in his betting history on the exchange. At block 5386, the method calculates a first quotient formed from the number of bets settled first by the bettor (as a dividend) and the total number of bets (as a divisor). At block 5388, the method calculates a speed quotient formed from the sum of the settled and first quotients (as a dividend) and a perfect score factor (as a divisor). The method 5000 calculates a product formed from the speed quotient and a speed average factor. See block 5390. At block 5392, the method labels the resulting product as a speed score. The method 5000 continues to another continuation terminal (“Terminal L15”).

From Terminal L15 (FIG. 5AO), the method 5000 proceeds to block 5394 where the method calculates the number of different betting partners the bettor has associated with over a recent period of time, such as within 30 days. Other periods of time are possible. At block 5396, the method calculates a bettor quotient formed from the number of different betting partners (as a dividend) and a recent bettor factor (as a divisor). The method 5000 then calculates the number of bets the bettor has placed over the recent period of time. See block 5398. The method proceeds to block 5400 where a bet quotient is formed from the number of bets (as a dividend) and a recent bet factor (as a divisor), the bet quotient being limited to 1 if its original value is greater than 1. At block 5402, a recent quotient is formed from a sum of the bettor and bet quotients (dividend) and a recent perfect factor (divisor). A product is formed from the recent quotient acting as the multiplicand and another multiplicand formed from a recent significant factor. See block 5404. At block 5406, the method labels the resulting product as a short-term activity score. The method then continues to another continuation terminal (“Terminal L16”).

From Terminal L16 (FIG. 5AP), the method 5000 proceeds to block 5408 where the method calculates the number of different betting partners the bettor has associated with over a medium period of time, such as 180 days. Other medium periods of time are possible. At block 5410, a bettor quotient is formed from the number of betting partners (dividend) and a medium bettor factor (divisor), the quotient being limited to 1 if its original value is greater than 1. The method then calculates the number of bets the bettor has placed over this medium period of time. See block 5412. The method proceeds to block 5414 where a bet quotient is formed from the number of bets (as a dividend) and a medium bet factor (as a divisor), the bet quotient being limited to 1 if its original value is greater than 1. A medium quotient is formed from a sum of the bettor and bet quotients (dividend) and a medium perfect factor (divisor). See block 5416. The method proceeds to block 5418 where a product is formed from the medium quotient acting as the multiplicand and another multiplicand formed from a medium significant factor. At block 5420, the method labels the resulting product as a medium-term activity score. The method then proceeds to another continuation terminal (“Terminal L17”).

From Terminal L17 (FIG. 5AQ), the method 5000 proceeds to block 5422 where for all bets in history, a first sum of products is calculated, each product being formed from the feedback and the bet amount for a particular bet. At block 5424, for all bets in history, a second sum of products is calculated, each product being formed from the maximum possible feedback and the bet amount for a particular bet. A quotient is then formed from the first sum of products (as a dividend) and the second sum of products (as a divisor). See block 5426. The method then proceeds to block 5428 where the method determines a feedback factor. At block 5430, a product is formed from the quotient as a multiplicand and another multiplicand formed from the feedback factor. The method proceeds to block 5440 where the method labels the resulting product as a feedback score.

From Terminal L18 (FIG. 5AR), the method proceeds to block 5444 where a first component of the honor rating is formed from a product of the performance average and the feedback average. At block 5446, a second component of the honor rating is a remainder formed from the first component of the honor rating (minuend) and the welsh/withdrawal multiple (subtrahend). The third component is a product formed from the remainder and the last five bets multiple. See block 5448. The method proceeds to block 5450 where the fourth component is a sum of the e-mail verification factor and the product formed from the remainder and the last five bets multiple. At block 5452, the fourth component is labeled as the honor rating for the bettor. The method 5000 then proceeds to exit Terminal M and terminates execution.

While illustrative embodiments have been illustrated and described, it will be appreciated that various changes can be made therein without departing from the spirit and scope of the invention.

• • The embodiments of the invention in which an exclusive property or privilege is claimed are defined as follows:

Claims

1. A computer system, comprising:

an exchange that facilitates transactions connected with risk-free bets among members of the exchange; and

a piece of evaluation software executing on the computer system, the piece of evaluation software providing an evaluation index for each member of the exchange, which is used to police risk-free bets on the exchange.

2. The computer system of claim 1, further comprising a bet forest that is implemented in a database, the bet forest including classes of bets to allow a bettor to find a location to list a bet or to wager a listed bet.

3. The computer system of claim 1, further comprising a bet listing wizard, the bet listing wizard assisting a bettor to list a bet by forming a bet proposition sentence.

4. The computer system of claim 1, further comprising a piece of accounts software that manages funds of various accounts connected with members of the honor-based betting exchange.

5. The computer system of claim 1, further comprising a piece of bet matching software, the piece of bet matching software determining whether a bet to be listed is substantially similar to another bet already listed in a bet forest.

6. The computer system of claim 1, further comprising a piece of withdrawal software, the piece of withdrawal software allowing a bettor to withdraw a listed bet or to withdraw a wager on a listed bet.

7. The computer system of claim 1, further comprising a piece of settlement software, the piece of settlement software tracking declarations of winners and losers and causing the accounts software to transfer funds from losers to winners.

8. A computer-implemented method comprising:

accessing an honor-based betting exchange by a first member to accept terms of an offer of a second member regarding a bet; and

rejecting the acceptance of the first member if a piece of honor rating software determines that an honor rating of the first member fails to meet an honor rating threshold specified by the second member, the honor rating being recalculated over time by the piece of honor rating software depending on wagering statistics and behaviors of the first member including his refusal to pay on a bet he wagered.

9. The computer-implemented method of claim 8, wherein prior to accessing the honor-based betting exchange by the first member, the offer is upsold in one or more classes of bets within a bet forest by the second member.

10. The computer-implemented method of claim 8, wherein the recalculation of the honor rating includes calculating a first component of the honor rating from a product of a performance average and a feedback average.

11. The computer-implemented method of claim 10, wherein the recalculation of the honor rating includes calculating a second component of the honor rating from a remainder formed from the first component of the honor rating as a minuend and a welch/withdrawal multiple as a subtrahend.

12. The computer-implemented method of claim 11, wherein the recalculation of the honor rating includes calculating a third component of the honor rating by a product formed from the remainder and a last five bets multiple.

13. The computer-implemented method of claim 12, wherein the recalculation of the honor rating includes calculating a fourth component of the honor rating by a sum of an e-mail verification factor and the product formed from the remainder and the last five bets multiple.

14. A computer-readable medium having computer-executable instructions stored thereon for implementing a computer-implemented method, comprising:

accessing an honor-based betting exchange by a first member to specify new terms different from terms of an offer of a second member regarding a bet; and

accepting the new terms of the first member if the honor-based betting exchange determines that the new terms are within an acceptable range and if a piece of honor rating software determines that an honor rating of the first member meets an honor rating threshold specified by the second member.

15. The computer-readable medium of claim 14, wherein prior to accessing the honor-based betting exchange by the first member, the offer is upsold in one or more classes of bets within a bet forest by the second member.

16. The computer-readable medium of claim 14, wherein the recalculation of the honor rating includes calculating a first component of the honor rating from a product of a performance average and a feedback average.

17. The computer-readable medium of claim 16, wherein the recalculation of the honor rating includes calculating a second component of the honor rating from a remainder formed from the first component of the honor rating as a minuend and a welch/withdrawal multiple as a subtrahend.

18. The computer-readable medium of claim 17, wherein the recalculation of the honor rating includes calculating a third component of the honor rating by a product formed from the remainder and a last five bets multiple.

19. The computer-readable medium of claim 18, wherein the recalculation of the honor rating includes calculating a fourth component of the honor rating by a sum of an e-mail verification factor and the product formed from the remainder and the last five bets multiple.