Published on: March 23, 2026, at 11:33 AM.
Updated on: March 23, 2026, at 11:33 AM.
- DraftKings, Flutter, and competing betting shares surged Monday with news of a Senate bill aimed at banning sports event contracts.
- This bill is expected to be introduced by a bipartisan group of lawmakers, indicating cross-party alignment.
Shares of DraftKings (NASDAQ: DKNG), Flutter Entertainment (NYSE: FLUT), and other sports betting companies experienced a significant boost on Monday following reports of bipartisan Senate efforts to stop prediction market operators from providing sports event contracts.
The Wall Street Journal indicates that Senators John Curtis (R-UT) and Adam Schiff (D-CA) may introduce the legislation as early as today, which would restrict firms under the Commodities Futures Trading Commission (CFTC) from facilitating sports derivatives. The CFTC is the federal authority overseeing prediction markets in the United States.
Stocks in the sports betting sector, which saw declines last year partly due to investors’ concerns over the rise of prediction markets, have jumped following these reports. In midday trading, Flutter’s shares rose by over 5%, while DraftKings gained nearly 2%. Entain Plc (OTC: GMVHY) and MGM Resorts International (NYSE: MGM), both jointly owning BetMGM, saw increases of 10.4% and 5.4%, respectively.
This positive market reaction likely stems from the well-known fact that sports derivatives constitute a significant volume of prediction market transactions. During the football season, some analysts suggested that this figure could reach up to 80%. Furthermore, reports indicate that 90% of Kalshi’s trading volume during the NCAA Tournament’s initial rounds was linked to sports event contracts.
Collaboration Against Sports Prediction Markets
In a highly polarized political environment in the US, finding common ground between party lines can be challenging. However, the sphere of sports event contracts represents one such issue where bipartisan agreement exists, to the detriment of the prediction markets industry.
The alliance between Curtis and Schiff may appear unusual initially, but it makes sense under scrutiny. Utah is known for its strict anti-gaming stance, a position it aims to maintain. Governor Spencer Cox (R-UT) has recently voiced strong opposition to prediction markets, asserting that event contracts are a form of hidden gambling.
Schiff’s representation of California, home to numerous tribal casinos, also plays a role. Tribal gaming entities perceive prediction markets as a challenge to their sovereignty because they negotiate gaming agreements with respective states, while prediction market operations typically don’t hold state gaming licenses.
Despite neither California nor Utah permitting sports betting, the partnership of Schiff and Curtis is the second incident where lawmakers from these states collaborate to introduce legislation targeting prediction markets. Recently, Representative Blake Moore (R-UT) and Representative Salud Carbajal (D-CA) put forth the Event Contract Enforcement Act, which aims to prohibit both sports event contracts and derivatives connected to assassination, terrorism, and warfare.
Reasons Behind the Surge in Sports Betting Stocks
While DraftKings, Flutter, and other sports betting stocks still have a long way to go to restore their previous highs, the rally on Monday deriving from the Curtis/Schiff legislation is easy to comprehend.
Even though those two companies have initiated their own yes/no exchanges and appear willing to invest significantly in these ventures, prediction markets currently don’t play a major role in their business. They are also avoiding offering sports event contracts in states where sports betting is permitted.
Adding to the reasons for today’s growth in sports betting stocks, a recent survey by Truist Securities indicated that most bettors would prefer DraftKings to Kalshi. This study also revealed that majority of prediction market users in states where sports betting is illegal would pivot to sports betting platforms if their states legalized it in the future.