In the US, there’s been a huge wave of ‘sweepstakes’ gambling sites recently. It mainly consists of sweepstakes casinos, but there’s also a small handful of sweepstakes sportsbooks, too. What do these sites have in common? They don’t allow you to bet real money.
If you’re wondering how that can possibly work, it’s actually quite simple. Instead of playing with money, sweepstakes casinos give you Sweeps Coins (SC) instead. If you collect enough of them, these coins can then be redeemed for prizes, such as cash transfers and gift cards.
What’s interesting about all of this is that — because sweepstakes gambling sites use virtual coins instead of real-life money like the US dollar — it means that most countries and states don’t recognize them as actual gambling sites. This is why sweepstakes casinos and sportsbooks are currently allowed to operate in 48 out of 50 US states.
However, changes — and we mean big changes — could be on the horizon. Moving forward, it’s possible that some states are going to start making moves by implementing bans on sweepstakes casinos, which would once again shake up the gambling industry.
The AGA believes that sweepstakes gambling sites have an unfair market advantage over traditional online casinos
In its call for action, the AGA has encouraged every state in the US to look more closely at sweepstakes casinos and implement stronger laws
By doing this, the AGA has told states that they will be able to better protect players and collect higher amounts of tax revenue
The American Gaming Association (AGA) is a trade group that represents the US casino industry, dealing with regulation matters, key industry issues, and the task of promoting responsible gaming. To make it simple, you can think of them as the champions of the industry who work in the best interests of the casinos and the players.
Just a few months ago, the AGA finally decided to make a statement on sweepstakes casinos:
“Where state laws and regulations are not clear, legislatures should consider enacting legislation to prevent unlicensed operators from exploiting loopholes in sweepstakes regulations to offer online real money gambling,”
By being able to legally operate in more states, it’s given sweepstakes gambling sites a major advantage over the likes of BetMGM, FanDuel, and other traditional online casinos. From the perspective of the AGA, this is unfair and also poses risks to players, which is ultimately why they’ve called for action.
It’s surprising that it took the AGA this long to make a statement on sweepstakes casinos. After all, sweeps casinos have been dominating the iGaming industry for close to five years, with Chumba Casino, Stake.us, and WOW Vegas gaining millions of sign-ups in the process. And now that the organization has finally made a statement against the sweepstakes phenomenon, it’s believed that some states will start to implement stronger laws and regulations over the coming years.
However, even though sweepstakes gambling sites are under pressure at the moment, it hasn’t stopped countless new sweepstakes casinos hitting the market. Heading into 2025, there are now close to 50 sweepstakes casinos to choose from, with new sites being added to SweepsGods every month. What’s clear to see is that sweepstakes casinos are the new crowd-favorite amongst players and here to stay — but it’s just a case of whether they will eventually face the same laws that traditional gambling sites have to deal with.
In more recent times, the US — as well as other countries around the world — appear to be taking gambling more seriously. For example, next year, a sports betting regulation bill proposed by northeastern legislators could potentially see a huge ban on in-game betting ads along with bets on college athletes. On top of this, New Jersey lawmakers are now pushing to block the sale of online lottery tickets, as they believe it’s harmful and is taking away too much money from local businesses. With all of this going on, it appears that it’s only a matter of time before the attention eventually turns to sweepstakes casinos and sportsbooks.
As of right now, the only states that have banned sweepstakes gambling sites are Washington and Michigan. Here, they’re outlawed completely, which is why the people living in these states aren’t allowed to access any type of sweepstakes casino or sportsbook. Instead, the only option they have is to use offshore sites or to simply not play at all.
Which states will be next when it comes to banning sweepstakes casinos? There’s no way to be sure. However, current trends in the iGaming industry point to an inevitable outcome where new states — at the minimum — introduce stronger sweepstakes gambling laws. By doing this, they will then be able to boost their tax revenue and better protect players, which is arguably the most important thing.
Sweepstakes casinos are able to bypass gambling laws in almost every state. This had created an iGaming industry where:
Sweepstakes casinos are legal in 48 out of 50 US states
Traditional online casinos are only legal in 6 out of 50 US states
Naturally, the advantage is with sweepstakes casinos, hence why they continue to attract millions of new players every year. It’s a genius move, too, as sweepstakes casinos — and other gambling sites that follow a sweepstakes model — have ditched traditional money and replaced it with virtual coins. The Gold Coins and Sweeps Coins that they use have zero value in the real world, so the sites themselves aren’t legally classed as gambling platforms.
That’s not the smartest part, though: sweepstakes casinos have also made it so that you can exchange any Sweeps Coins you win for real prizes, including cash transfers, cryptocurrencies, and gift cards. As a result, they can maintain a strong level of appeal with both casual players and competitive players.
If sweepstakes casinos allowed players to bet real money, they know that the consequence of this would be that they’re subject to the same gambling laws as everybody else. This would impact their profitability, make them less widely accessible to players, and ultimately create a level playing field with traditional online casinos, which they (obviously) don’t want to happen.
It’s an interesting time to be in the gambling industry and nobody knows for sure what the future is going to look like. For now, sweepstakes gambling sites are the shiny new toy of the industry and keep attracting millions of new players. This has caused a major headache for traditional gambling sites, who’ve lost out on customers as a result. But following the AGA’s call for action, we could see sweepstakes casinos face stricter state gambling laws moving forward, which would create a fairer industry and a more responsible gaming environment for players. Until then, it’s a case of waiting to see what happens — but it’s clear to see that some states are almost certainly going to make some changes soon.
