Sweepstakes Casinos: The State of Play in 2025

Sweepstakes Casinos have turned into an absolute juggernaut of a business in the United States and Canada, where strict gambling laws prohibit traditional real-money casinos. Sweeps casinos have turned into an $11 billion dollar-a-year industry, and not everybody is happy with that.

Florida and New York State are the latest authorities to propose bills banning Sweepstakes Casinos. Mississippi, California, and Montana all have pending legislation, and others have sent cease-and-desist letters to Sweeps Casino operators.

Last August, the American Gaming Association published a paper asking Attorney Generals in every state to investigate the sweepstakes model and take action if they found non-compliance with local regulations.

In December 2024, the National Council of Legislators from Gaming States (NCLGS) also called for the total prohibition of Sweepstakes Casinos.

So, 2025 is going to be a critical year for the Sweepstakes casino industry, and now, 3 months into the new year, we try and get an overview of the current situation.

The Sweepstakes Casino Model

The controversial model employed by Sweeps Casinos is a dual virtual currency system that gives out Gold Coins for free play that have no cash value and Sweeps Coins that are awarded as promotional bonuses but can also be redeemed for cash. 

This dual currency system tap dances past the regulations on real money gambling. The Gold Coins have no value, while the Sweeps Coins cannot be purchased. So technically, there is no potential loss, and, again, it’s not gambling. 

Players can write in for an Alternative Method of Entry and request free Sweeps Coins, which satisfies the free-to-play element essential to the sweepstakes casino’s legal status. 

At a Sweepstakes Casino, there is no real money gambling at any time. The promotional nature of the Sweeps Coins and the free-play element means the whole affair falls under Sweepstakes laws that were originally designed for lotteries and prize draws. It also means they are legal in 46 US states, and most of Canada – for now. 

American Gaming Association Battle Cry

The American Gaming Association declared war on Sweepstakes Casinos with a paper entitled: “Regulatory Vigilance Critical to Ensure ‘Sweepstakes’ Don’t Threaten Consumers and Undermine Gaming Regulation.” 

The paper had no subtle undertone. It was a clear accusation that Sweeps Casino’s business model is designed to sidestep gaming regulations, deny basic protection to players, and deny state authorities tax and revenue. It is worth mentioning, though, that the AMA represents the US casino and online gambling industry, which is barred from most US states where Sweeps Casinos operate with impunity.

The National Council of Legislators from Gaming States (NCLGS) is a nonpartisan group made up of state legislators, and its proposed legislation in December arguably carries more weight. Its Model Internet Gaming Act recommended the total prohibition of Sweep Casinos with fines up to $100,000 for each violation as part of a blueprint of regulations for states wishing to legalize and tax online gambling.

State-Level Action Against Sweeps Casinos

It has been a pivotal 12 months for the Sweeps Casino sector, with some big name launches like BCGame.US, and some big rulings against them in US states. Some states have taken a stand against this form of online gambling, either with new legislation or existing laws.

State-level action against specific Sweepstakes Casinos and the business model include:

Legislative Changes

• Mississippi: The state senate passed bill SB 2501 that will prohibit Sweeps Casinos, and it’s just waiting on the House vote to ratify the change to the law. 
• New York State: Senate Bill S5935 is an extension to the existing act, is under consideration, and is looking to ban Sweeps Casinos.
• New Jersey: Proposed Bill A5196 will regulate sweepstakes casinos like traditional online gaming operators.
• Florida:  S1404 and HB953 are new bills specifically targeting sweepstakes and offshore casinos.
• Maryland: SB 860, which seeks to prohibit online sweepstakes games, was passed by the Senate Budget and Taxation Committee on March 7, 2025. 
• Connecticut: SB 12535 will limit sweepstakes that involve simulated online casinos or sports wagering. 

Cease & Desist/Subpoenas

• Michigan: Sent cease and desist letters to three online gaming operators that have since blocked residents from the site. The state considers sweeps casinos a form of gambling, which is prohibited.
• Maryland: The Maryland Lottery and Gaming Control Agency sent cease-and-desist letters to 11 operators it considered to be running illegal gambling operations in January 2025. 
• Delaware: The Delaware Division of Gaming Enforcement recently ordered a sweepstakes operator to block access within the State.
• Connecticut: The Connecticut Department of Consumer Protection sent one cease-and-desist letter to a major casino that subsequently left the state.
• West Virginia: The Attorney General aggressively pursued sweeps casinos with subpoenas on those operating in the state. 

Lawsuits Against Sweepstakes Casinos

Numerous opportunistic lawsuits have been filed in various states, with a recent New Jersey case dragging Apple Pay and Google Pay, along with McLuck, Wow Vegas, and CrownCoins Casino, citing RICO laws designed to fight organized crime. That suit came from a disgruntled player who spent $1000 on coin packages.

Chumba Casino’s parent company, VGW Holdings, is also fighting numerous class action lawsuits, and several casinos have pulled out of states that seemingly don’t support the business model. A large class action suit was dismissed in Georgia in December 2024, as the Judge simply didn’t have the jurisdiction to proceed with a case against the Australian company.

A Washington judge ordered High 5 Casino to pay $24.9 million in February 2025, following the $415 million judgment against DoubleDown Interactive LLC and International Game Technology in June 2023. 

High 5 Entertainment also has an ongoing case in California where it was accused of running an illegal gambling enterprise. It has since pulled out of the state, citing an adversarial climate. 

Did Sweeps Casinos Fly Too Close to the Sun?

When Chumba Casino launched in 2012, it was just a flicker on the radar of the gaming authorities and state regulators. By 2019, a series of other sweeps casinos had launched, but the whole sector turned over just $460 million in revenue and remained a niche within a niche.

The business model was always controversial, but the casinos lived in the shadows.

From 2019 to 2022, that revenue soared to $3.1 billion, and just a few years later, the Sweeps casino sector is on course to net $11 billion in revenue this year. In recent times, the likes of Stake.Us, Wow Vegas, and Pulsz Casino have engaged in aggressive marketing campaigns that have raised the profile of the sweeps model. 

Chumba Casino now has 1 million active monthly players, more than 80 sweepstakes casinos are targeting US customers and big name casinos are launching each and every month. The casinos are evolving into a real alternative to traditional online gambling with table gamers, live dealer sections and sportsbooks. 

Now, a niche curiosity has become one of the fastest-growing sectors of the online gambling industry, which has put the whole business model in the spotlight. It has become too big to ignore, and this niche sector that slipped through a loophole in the gaming regulations could simply have flown too close to the sun. 

Sweeps casinos have drawn the ire of the traditional igaming operators, who cannot operate in most US states, and they in turn have brought them to the attention of the state legislators. States with legalized gambling face pressure from licensed casinos to enforce a level playing field and states that have banned online gambling cannot and will not ignore an industry that has circumvented its rules and laws.

While Sweeps casinos were too small to go after, that is no longer the case. The sector, then, stands at a crossroads. It can either withdraw from state after state as the loopholes close and the regulations shut them down, or it can form its own legislation that works for the individual states and create a new framework for the sweepstakes casinos of the future. 

Conclusion

Sweepstakes casinos have been one of the industry’s greatest success stories in recent years, but 2025 is a critical moment. Several states are drawing regulatory lines in the sand, and others are preparing to go to war with the whole business model. Sweepstakes casinos have grown too big to hide in the shadows, and 2025 is the year that the sector matures or withers and dies. 

We think it’s time for the sector to join forces and create a set of guidelines and a code of conduct that the state regulators can accept. This may mean radical changes to the whole concept of a Sweepstakes casino.

But whatever happens, the months ahead could be critical in shaping the future of Sweeps casinos, and we’ll follow it all as it happens.