The 2026 NCAA basketball tournaments are anticipated to shatter previous betting records, with projections indicating total wagers may soar to $4 billion. This marks a substantial rise of 6.7% from the $3.7 billion wagered in 2025, showcasing the growing enthusiasm for the event.
Record-Setting March Madness Betting in 2026
March Madness remains a dominant force in U.S. sports betting, eclipsing even the Super Bowl, which takes in about $1.4 billion in bets. While the Super Bowl’s singular nature makes it the most wagered event on a single day, the sheer volume of games in March Madness—the men’s and women’s tournaments together—makes it the most bet-upon sporting event in the U.S. H2 Gambling Capital projects that 2026 will surpass the previous year’s betting levels, citing continued growth in U.S. states where sports betting is now legalized, alongside the introduction of Missouri’s betting market in December.
The tournaments, kicking off on March 17 with early games and the first full round on March 19, offer a betting window of approximately three weeks, making it a peak period for sportsbooks, both online and in retail settings.
The Role of Prediction Markets in March Madness Betting
In addition to traditional sportsbooks, new prediction markets are beginning to play a larger role in March Madness wagering. These markets allow participants to trade contracts based on the outcome of the tournament, including predicting which team will emerge as the champion. Such markets are seeing increasing activity, with H2 estimating that prediction market bets for 2026 could total approximately $530 million, an addition that could push the overall betting volume closer to $4.5 billion.
However, these prediction markets operate under different rules than conventional sportsbooks. They count both sides of a trade in their reported volume, making their total figures appear larger than traditional sportsbook “handle,” which only reflects the bettor’s stake. As an example, a $50 bet in a sportsbook equals $50 in handle, whereas a 20-cent “yes” contract in prediction markets counts as $1 in total volume.
Despite their increasing popularity, the legality of these prediction markets remains a subject of debate. Various state regulators argue that they may be unlicensed gambling platforms, bypassing state laws and taxes. On the other hand, the exchanges claim to fall under federal oversight by the Commodity Futures Trading Commission.
State Impact and the Influence of Legal Betting Markets
In states where sports betting is legal, prediction markets are expected to have less impact. H2’s analysis suggests that in these regions, prediction markets will likely generate a “handle equivalent” of $135-150 million, roughly 3.5% of the total sportsbook handle of $4 billion. However, analysts believe that the growth of prediction markets will not be a significant factor affecting sportsbook performance in these states.
Sportsbooks, even with competition from prediction markets, are expected to see strong results in 2026. H2 projects a 7% hold rate, which represents the share of wagers retained as revenue by sportsbooks—a slight increase from the previous year’s hold rate of 6.1%. This uptick is largely attributed to the expected outcomes during the tournament, which could result in more favorable results for sportsbooks.
Betting Trends and Market Dynamics
Beyond the sheer size of the wagers, March Madness also influences the behavior of bettors. Data from the analytics app Juice Reel shows that during the 2025 tournament, average bet amounts increased, with the average bet during the tournament period being $36.50, compared to $43.27 in the pre-tournament period. This suggests that many bettors engage primarily during the tournament itself, with 12% of March Madness bettors placing no wagers before the event.
Sportsbooks will continue to rely on key factors such as bracket outcomes to determine their profitability, with hold rates often lower than in professional leagues due to fewer player-prop wagers and less demand for same-game parlays. Despite these nuances, sportsbooks are expected to earn around $279 million in gross gaming revenue from the 2026 tournament, a 23% increase over 2025.
Source:
“March Madness Betting Expected to Reach $4B in 2026“, news.worldcasinodirectory.com, March 10, 2026.