Sweepstakes Casino Laws by State: Where They Are Banned in 2026

A sweepstakes casino is the American workaround for states that do not license online casinos: two virtual currencies, one to play with and one that can be redeemed for prizes. In 2025 and 2026 the workaround ran into a wave of legislation.

On our state records, last checked on 17 September 2026, 13 states ban sweepstakes casinos: 11 through statutes passed in 2025 and 2026, and Utah and Washington under older law. Eight more restrict them through enforcement rather than a statute. Twelve have no ban and operators active. In the remaining 18 jurisdictions, the District of Columbia among them, the position is unsettled.

This guide sets out which states are which, under what law, and what the sweepstakes operator we track does about it. It describes the law as reported. It is not legal advice.

How the model works

A sweepstakes casino sells one currency and gives away another. At Stake.us, the operator we track, Gold Coins are for play and cannot be redeemed. Stake Cash comes free with Gold Coin purchases and can be redeemed for prizes, once it has been played through three times. Because nothing bought can be cashed out directly, operators argue the product is a promotion rather than a wager, and that is how Stake.us runs without a gaming licence in any state.

The new laws reject that argument, and most of them are written against the dual-currency design itself rather than against gambling in general.

The 11 statutory bans

Montana's was the first explicit ban.

The penalties vary as much as the dates. California makes it a misdemeanour to operate, offer, market or promote these games, with fines of $1,000 to $25,000 and up to a year in jail. Indiana sets civil penalties of up to $100,000. Louisiana treats them as gambling by computer, with fines up to $100,000 and up to five years' imprisonment, and a companion bill adds gambling offences to the state's racketeering statute. Nevada requires disgorgement of profits. New York reaches past the operator to the payment, geolocation and promotion services around it. Montana added felony penalties.

Oklahoma's passed over a veto. Governor Kevin Stitt vetoed SB 1589 on 7 May 2026, calling it vague and overbroad, and the legislature overrode him on the last day of the session. Gaming run by tribes under federal law is exempt.

One tracker counts Nevada's law as enforcement rather than a ban. Most count it as a ban, and so do our records.

Two older bans

Utah and Washington needed no new law.

Utah's total prohibition on gambling already covers sweepstakes casinos. Our record notes that taking part is a class B misdemeanour and that operating is reported as a third-degree felony.

Washington's covers them through a statute that makes transmitting gambling information online a class C felony, read together with court decisions that treat virtual chips as a thing of value.

Eight states that restrict without a ban

These have no sweepstakes statute but act against the model anyway.

• Michigan. The gaming board has used existing law against dual-currency operators since late 2023, and secondary reporting says no sweepstakes platform legally operates there as of May 2026.
• Illinois. The gaming board sent cease-and-desist letters to about 65 operators in February and March 2026. Two had complied by May.
• Delaware. Cease-and-desist orders to VGW in 2023 and 2025 held that unlicensed sweepstakes games break the state constitution. VGW withdrew in April 2025 and more than 30 other brands followed.
• Arizona. Cease-and-desist letters went out in 2025. Some operators withdrew and others stayed.
• Idaho. The constitutional ban on casinos is applied to sweepstakes casinos, and cash-prize redemptions are barred.
• Iowa. A 2026 law in force since 1 July lets the regulator issue cease-and-desist orders and seek injunctions against unlicensed sweepstakes. It is an enforcement law rather than an explicit ban.
• Minnesota. Reported to be under pressure from the attorney general. Our confidence here is low.
• Vermont. No ban, but major operators exclude it, generally attributed to its consumer-protection rules on prizes and sweepstakes. Also low confidence.

Twelve with no ban, several of them close calls

Alabama, Alaska, Arkansas, Colorado, Florida, Georgia, Hawaii, Kansas, Kentucky, Massachusetts, North Dakota and Texas have no ban and operators active. No ban is not a licence: the operator we track holds none in any state, and North Dakota's record notes that no agency there licenses or audits these sites.

• Florida. A ban passed the Senate unanimously and an amended version passed the House, but the Senate did not agree to the amended text before adjourning on 13 March 2026. A renewed push is expected in 2027.
• Massachusetts. The ban was written into H 4431, which was sent to study in March 2026. The state gaming commission has publicly discouraged residents from using these sites.
• Texas. SB 517 would have reached dual-currency models in 2025 and failed in the Senate.
• Hawaii. SB 3281 was deferred in committee in 2026.
• Arkansas. SB 524 was pulled by its author in 2025.
• Alabama. Roughly 21 private lawsuits against operators have been reported.

Eighteen where the answer is unsettled

In most of these no specific statute or enforcement action was found. A few are worth naming.

• Maryland. HB 295 passed the House of Delegates 105 to 24 on 20 March 2026 and never reached a Senate vote. The state's gaming regulators backed it, and another attempt is expected in 2027.
• Virginia. HB 161, which paired a sweepstakes ban with legal online casinos, failed in 2026.
• Ohio and the District of Columbia each carry a ban inside a stalled or pending bill.
• Pennsylvania. The gaming board has warned publicly that unlicensed sweepstakes games are illegal. No statute has passed.

What the operator's own list says

Stake.us's help centre, last updated on 23 July 2026, lists 20 states where it is not available. Set against our records:

• 9 ban sweepstakes casinos: California, Connecticut, Louisiana, Montana, Nevada, New Jersey, New York, Tennessee and Washington.
• 6 restrict them: Arizona, Delaware, Idaho, Illinois, Michigan and Vermont.
• 4 are unsettled: Maryland, Pennsylvania, Rhode Island and West Virginia.
• 1 has no ban: Kentucky.

Four states that ban the model on our records are not on that list: Indiana and Maine, whose bans took effect in July 2026, Oklahoma, where platforms have until 1 November 2026 to leave, and Utah. A second source lists Indiana and Maine as excluded, so the help-centre text may simply be behind the practice. Read the operator's list on the day you sign up, and treat the statute as the thing that binds.

Where the real thing is licensed

Eight states license real-money online casinos: Connecticut, Delaware, Maine, Michigan, New Jersey, Pennsylvania, Rhode Island and West Virginia. Five of those eight ban or restrict sweepstakes casinos, against 16 of the other 43 jurisdictions. Where a state licenses the real product, the substitute has met the most resistance.

None of the 51 authorises the offshore real-money casinos that most of this site covers. Our records mark them illegal in 14 jurisdictions and unauthorised in the other 37.

How sure we are

Of the 51 sweepstakes records, 44 are held at medium confidence and 7 at low: Minnesota, Mississippi, Missouri, North Dakota, South Carolina, South Dakota and Vermont. Most rest on trackers that follow this legislation closely, cross-checked against state announcements where we could read them.

The law here changed month by month through 2026 and will keep changing. Each state's page, reached from our US hub, carries the sources behind its entry. For what the operator's terms ask of you once you are in, see how to read casino terms and KYC explained.