Social and sweepstakes casinos
Social casinos offer slot and table games played with virtual coins that cannot be cashed out. Sweepstakes casinos use a similar product with a second, "sweeps" currency that can be redeemed for cash prizes, and argue that this makes them promotional sweepstakes rather than gambling. The first model is established; the second is under growing legal pressure.
Social casino
Social casinos make money by selling packs of virtual coins, like any free-to-play mobile game. Players cannot win money, so in most jurisdictions social casino is not gambling, though app stores, consumer protection authorities and courts have looked at spending by heavy users and at loot-box style mechanics.
Sweepstakes casino
- Players buy "gold coins" for fun play and receive "sweeps coins" as a free bonus; sweeps coins won in games can be redeemed for cash.
- Because a free way to enter is always offered, operators argue that no purchase is necessary and that US sweepstakes law, not gambling law, applies.
- Regulators and legislators in a growing number of US states disagree. Since 2025 several states, including California, have passed laws banning sweepstakes casinos, and others have issued cease-and-desist orders.
What it means for the industry
For licensed operators, sweepstakes casinos are unlicensed competition in states without regulated online casino. For suppliers, payment providers and affiliates working with them, the legal risk is rising state by state. Check the United States page of our tracker for the current position.
Related: online casino and skill gaming.
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