It is a hugely popular website that enables ordinary punters to act as bookies. As well as placing bets, gamblers on Betfair.com can also take them. On the internet anybody with a relatively small amount of money can become a baby Paddy Power.
Betfair effectively acts as a matchmaker for gamblers. If I want to bet on a race at Thurles this afternoon, for example, I simply have to find a "layer''on the site who will take my wager at the best odds possible. Betfair then takes a cut of 5pc on any winnings.
During its 10-year existence Betfair has seemed like a perfect online business, pushing its most recent half-year profits to over €50m.
But then last week during an apparently unexceptional hurdle race at Leopardstown, disaster struck.
A smalltime Betfair user with less than €1,200 in his account offered ludicrous odds of 28/1 on a highly fancied horse Voler La Vedette.
The price was given when the horse was still running and looked like it had every chance of winning, and the Betfair user offering it could have been left with potential liabilities of €700m.
For seasoned online punters, sitting at their computer screens, it was an offer that was too good to be true. On the course, and in traditional turf accountants, the price was a much more modest 13/8.
But hundreds of ordinary gamblers obviously thought that all their Christmases had come together when Voler La Vedette duly won the race.
The punters who had bet at the inflated odds of 28/1 on the website looked forward to a huge pay-out, but their hopes were dashed when the company declared the wagers void.
The company said that the incident occurred because of an "obvious technical failure" and that the winnings would not be paid. Stephen Morana, acting chief executive of the British-based firm, said the glitch was "triggered because of a unique sequence of events that had never happened before''.
Over the past decade, betting has been revolutionised by the internet. Punters no longer have to darken the doors of smoky betting shops next to desperados in order to indulge their habit.
Now, they can sit in their pyjamas at any hour of the night and bet on a dizzying variety of events -- from a darts match to the colour of Michael Noonan's tie on Budget day.
The potential exposure of one Betfair user to losses of up to €700m are mind-boggling and would even make a NAMA builder blush.
On this occasion it was all down to a monumental cock-up, but the history of sports betting and bookmaking is littered with similar disasters, scams and coups.
There have been countless occasions when traditional bookmakers refused to pay up because the odds simply did not stack up.
In one of the most notorious incidents in Irish betting history, bookmakers smelled a rat when a speedy greyhound called Ballydonnell Sam romped home in a race at Mullingar at odds of almost 1,000-1.
The dog's owner Con Murphy plotted the coup in 1979 by manipulating the odds on the Tote, the State-run betting alternative to the bookmakers that operates at each track
Murphy made his bid for riches by sending a large group of associates to the track. Their instructions were to bet on every dog in the race except Ballydonnell Sam. Then they had to stop others from betting on their favoured dog by causing delays and blocking up the Tote windows.
One of the participants in the coup reportedly mesmerised other punters by performing magic tricks.
At the same time, another group was sent to betting shops around the country to place small bets on the Ballydonnell Sam. At that time it was still possible to place bets with small turf accountants at "Tote prices''.
Because so few bets had been placed on him on the Tote at the track, Ballydonnell Sam won at 956-1. Con Murphy and his pals thought they had hit the jackpot. They stood to win £90,000, but all but two bookmakers refused to pay up.
Another tried-and-trusted trick, used by trainers, is for a horse to be entered in a race under its name, but then replaced by a speedier nag who looks identical.
Long before racing was televised and computerised there have always been problems with betting.
In one famous case in England, punters even went so far as to invent their own fictitious track, Trodmore, sending a programme of races, and their subsequent results to The Sportsman newspaper. Naturally, they backed all the winners.
Of course, the Betfair fiasco was caused by technical problems rather than any chicanery on the part of those involved.
Occasionally, the system may go wrong, but usually the bookies end up the winners.
Punters always hope to get something for nothing, but they should follow the time-honoured advice that betting is "a sure way of getting nothing for something''.