Controversial Sweepstakes: The View From The Bridge

Once able to operate under loosely-defined promotional laws in almost every U.S. state, a tide of new legislation is ending the ambiguity that has long shielded the booming sweepstakes casino industry. 

And today these dual-currency gaming sites are facing mounting scrutiny.

California’s recent legislative crackdown–SB 831, signed into law this month–has cast the issue back into the spotlight. But the so-called “Golden State” is far from alone. 

New Jersey, Montana, Nevada, Idaho, Washington and Connecticut have all enacted similar legislative bans; while Mississippi, Arizona, Maryland, Michigan, and others, have issued stinging cease-and-desist orders to prevent sweepstakes operators targeting their residents.

Yet the sweepstakes vertical remains unshaken, maintaining it does NOT offer gambling, but instead provides safe ways to play casino games in a low-cost, low-risk and, crucially, social environment. 

It’s All In A Currency

Sweepstakes are dual-currency sites providing casino games such as slots, roulette and blackjack. 

Usually, players purchase “Gold Coins”, which they stake on games and can earn by claiming “bonuses”. 

If players purchase Gold Coins, they also receive free “Sweeps Coins”, which can be redeemed for cash prizes. 

This structure allows operators to claim that, since no direct payment is required to play, it’s not gambling. 

But lawmakers contest that this is little more than a loophole to facilitate illegal gambling, while endangering players. Sweepstakes should be shut down, opponents argue.

It’s Only Entertainment, Not Gambling

In 2022, the massively successful U.S. sweepstakes sector generated an estimated US$3.1 billion (£2.31bn), with projections suggesting US$11 billion (£8.20bn) by the end of 2025. 

Yet operators maintain that the sector is about entertainment – not profit.

“The sector now stands at a crossroads”, says James Bennett (main photo), Managing Editor of U.S.-facing sweepstakes affiliate site Sweepchecker.com. 

“It’s been fundamentally misunderstood but could hold the key to a more sustainable, safer, and inclusive future for digital entertainment in the United States.

“Tens of millions of Americans log-in daily, most depositing just a few dollars to enjoy hours of entertainment”, says Bennett. “Nowhere else can you get this type of value in gambling or any gambling-adjacent sector.”

And according to the Sweepchecker boss the model: “Delivers genuine casino-style excitement, without the high stakes or addiction.

“It’s entertainment, not profit-first,” affirms Bennett. 

Pushback

The debate has split some in the gambling industry, particularly in California, where it divided Tribal gaming factions. 

Some viewed sweepstakes as an opportunity to diversify and digitise, while others opposed them outright.

Advocates believe that formal regulation, rather than bans, is the best path forward. 

They say that clear oversight could transform sweepstakes casinos from a legal dilemma into legitimate, taxable businesses.

According to Bennett, sweepstakes acquire new users at three times the rate of traditional online casinos.

“For millions, they’ve become a mainstay of online entertainment – a digital alternative that delivers fun and social connection, not financial risk as most players deposit under US$20,” he claims.

Moreover, as sweepstakes are social and “thrive on community interaction, like social chats, giveaways, and competitive events, they create healthier and less isolating digital environments”. 

And that’s not to mention the tax benefits, which, says Bennett, could contribute billions into state budgets and infrastructure.

Opportunity Knocks? 

But critics counter that sweepstakes casinos aren’t without risk. 

Even when played for free, they rely on interval bonuses–rewarding players for daily or hourly logins–and feature the same high-velocity real-money games as casinos, meaning addiction remains a very real concern.

Transparency is another matter: Unlike regulated online casinos, sweepstakes aren’t required to publish payout rates, fairness statistics, or responsible gambling tools – all hallmarks of trust and legitimacy in the regulated industry.

In the U.S., where online casino remains legal in only seven states, many see them as simply plugging a temporary void. A position that is far from stable and unlikely to improve. 

Lawmakers in many states are more interested in the long game of regulating online casino or iCasino. 

Cannibalisation

And negativity towards sweepstakes, argue cynics, is more about the threat of cannibalisation, impacting land-based casinos, in particular, than a real overriding moral concern.

Even with the odds piled against them, sweepstakes operators are gathering and openly calling for regulation.

Argues Bennett: “If regulators, operators and tribal stakeholders can align on clear rules, sweepstakes casinos could become a global case study in ethical entertainment economics – low-risk, high-engagement and community-driven.

“The question isn’t whether sweepstakes casinos should exist.  It’s about how we can make them work better for everyone: Players, states, and communities alike.”

But therein lies the rub.

From a legal standpoint, the question is whether they should exist at all – not the potential they hold to revolutionise gambling.

And with multiple states taking action, it seems sweepstakes may be fighting a losing battle.

What’s next?

We’ll be watching closely.