Prediction Markets Challenge Traditional Sportsbooks as March Madness Commences Amid Expanding Multi-State Legal Battles

March Madness betting surges as Kalshi hits $58M in volume, while Virginia, Wisconsin, and Tennessee weigh major gambling bills and prediction market bans.

By: AXL Media

Published: Mar 16, 2026, 12:11 PM EDT

Source: The information in this article was sourced from Gambling Insider

March Madness Serves as Proving Ground for Prediction Markets

The commencement of the NCAA March Madness tournament represents a critical juncture for the U.S. wagering industry, specifically highlighting the growing influence of prediction markets. Kalshi has already reported trading volumes exceeding $58 million for the tournament champion, with Duke, Michigan, and Arizona emerging as the primary favorites. This surge in activity mirrors the $500 million in volume seen during the 2026 Super Bowl, suggesting a behavioral shift among bettors who are increasingly viewing prediction platforms as viable alternatives to traditional sportsbooks. Analysts are closely monitoring whether probability estimates on these markets will continue to track with sportsbook odds as the tournament progresses.

Virginia Executive Branch Evaluates Gambling Expansion Bills

Following the conclusion of the Virginia legislative session on March 14, the industry’s focus has shifted to Governor Abigail Spanberger’s desk. Lawmakers have advanced several high-priority measures, including the regulation of skill games and daily fantasy sports, alongside a potential casino referendum for Fairfax County. While online casino legalization stalled in conference committees, the governor’s upcoming decisions on the approved bills will dictate the pace of expansion in the state. The fate of the skill games bill is of particular interest, given its controversial history and a previous gubernatorial veto in 2024.

Tribal Sovereignty and Revenue Conflicts Stall Wisconsin Betting

Wisconsin’s legislative efforts to legalize mobile sports betting face a complex path forward as the measure reaches the Senate. The current proposal utilizes a tribal-controlled model similar to the framework established in Florida, granting Native American tribes exclusive rights to oversee online operations. While the Assembly has already approved the bill, it faces significant opposition from national operators like DraftKings and FanDuel. These companies argue that the revenue-sharing structures inherent in compact-based models create economic hurdles for outside participants, leading to a visible divide among Senate Republicans.