What is a Blind-Bid Auction System (or FAAB)?

The Blind Bid Auction system (also known as a FAAB) allocates a budget of fake "money" to each team before the season for them to spend on free agent players on waivers. Waiver claims are awarded to the highest bidder instead of the worst-ranked team. If there is a tie of two or more teams during the regular season, the player will be awarded to the team with the worst rank. And if there is a tie during the pre-season, the player will go to the team with the highest draft order. Each time a claim is processed, the bid amount is deducted from the remaining budget.

Example If Team A bids $50 on Player X and the next highest bid is just $27, Team A will be awarded Player X and charged the full $50 of its bid.