By Nick Devor
The University of Connecticut's stunning last-second upset over Duke in the March Madness college basketball tournament is the kind of moment that fans wait all season for.
It's also the exact outcome sports betting firms hope to see.
Duke was the heavy favorite to win not only Sunday night but the entire tournament, and casual sports bettors tend to pick the favorite. Sportsbook revenues are directly tied to customer losses -- so when a favorite loses, sportsbooks win.
UConn's upset means bettors who put money on the underdog will receive a larger payout. But because fewer bettors typically back the underdog, payouts usually don't eclipse sportsbooks' overall revenue.
The sportsbooks could use the extra boost. On March 19, gambling industry research firm Eilers & Krejcik Gaming projected that March Madness handle -- the total amount wagered -- would decline 1.7% from last year, "reflecting the low-to-flat growth environment in the maturing U.S. market," the firm wrote in a research note.
As of Monday morning, shares of DraftKings and FanDuel-parent Flutter are down 18% and 7.8%, respectively, since the beginning of the tournament on March 17.
Sportsbook stocks have been under pressure over the past year in part because of the rise of prediction markets. Platforms like Kalshi and Polymarket sell event contracts, federally-regulated financial instruments tied to binary outcomes like which team will win a sporting event. These products closely mimic online sports betting and are available nationwide to users 18 and older, even as traditional online sports betting remains illegal in 19 states, including California and Texas.
Polymarket has a data sharing partnership with Dow Jones, the publisher of Barron's. The firm did not respond to a request for comment.
Meanwhile, March Madness has been a boon for the prediction markets. Kalshi, the leading U.S. firm, tells Barron's it's seen $1.76 billion in total trading volume related to the tournament, with $36.5 million traded on the Duke-UConn game alone.
Write to Nick Devor at nicholas.devor@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
March 30, 2026 16:11 ET (20:11 GMT)
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