Most people in the lead bet enough to make sure that, if they get the answer right, they will win (i.e., enough to end up more than double the second place person). Knowing that, the second place person should bet such that, if the 1st place person misses the answer, they will have more money (regardless of their answer, right or wrong). Which is what James did, with the additional knowledge that he had to remain above double the third place person, whether he was right or wrong.
It is like one of those “game theory” questions where the goal is to walk away with the most money for him. Most people “assume” it means going for the fence. But in this case that is not the right move.
People will be talking about this like the Monty Hall Game question.