For many, the collapse of Football Index came out of the blue, but some experienced traders who were familiar with the platform forecast its demise several months ago.

Owned by BetIndex, Football Index was launched to much fanfare in 2015. It marketed itself as the perfect combination between fantasy football and stock trading, in which customers traded virtual shares in selected professional footballers that went up and down in value depending on the player’s performances and other metrics.

Promising to challenge the status quo of traditional betting services in the UK, Football Index sold time-sensitive shares in players which could return dividends throughout the duration of the three-year contract period. You can see for a guide on how the dividends worked, but in short, the payouts tended to range from 1p up to 14p a share.

However, following a number of sudden crashes in player’s share prices in addition to a drastic set of rule changes on the betting platform, Football Index customers started to become concerned. Caan Berry, a successful Betfair trader, who has a large YouTube following, was among the first to voice his discontent with what he saw happening on the platform.

Berry published a video on his YouTube channel explaining his thoughts. In it, he raised the issue of Football Index telling users that they were buying ‘shares’ because you only got a three-year contract on a particular player. For some, that perhaps wanted to get in early on a young wonderkid, only owning him for this length of time may not pay-off.

Secondly, Berry pointed out that the company’s policy change put a halt to the ‘instant sell’ feature on the platform. This used to allow bettors to quickly sell their stock back to Football Index. Instead, the only way to get rid of your shares was if another customer wanted to buy them; however, Football Index’s new terms and conditions allowed them to mint new tokens, which wiped out many peer-to-peer trading markets.

Concerning for customers is the fact that the T&Cs clearly state that once shares have been purchased on the platform, the user’s funds are not held in a segregated account. This means that there is no guarantee of getting a refund if the company becomes insolvent.

Many have asked how this could happen, seeing as Football Index is licensed and regulated by the UK Gambling Commission, but it appears they didn’t see the writing on the wall either. A crumb of comfort is that cash balances can be withdrawn, yet this truly is a crumb when there are traders with shares totaling seven figures locked in the game.

Previously, the proud sponsor of two EFL Championship teams – Nottingham Forest and Queens Park Rangers, Football Index has had its gambling license suspended. A specialist financial advisory company is assisting in finding a buyer for the platform, while several MPs have called for a full inquiry as to why the regulators failed to act to protect UK players.