How the Sweepstakes Model is Changing iGaming in the US
One of the biggest changes in US iGaming since the start of the new decade has been the meteoric rise of sweepstakes casinos. These new types of casinos have been attracting plenty of attention for several years now and it’s easy to see why considering they remain legal in the majority of US states (38, as of right now). Simply put, sweepstakes casinos are much more accessible for American gamblers, which has led to the sweepstakes vertical having a huge impact on the iGaming economy.
‘Freemium’ Sweepstakes Casinos Are Providing Players with Something Different
For decades, online casinos were the only legitimate option for PC and mobile users living in the US. But traditional online casinos have always been extremely limited in state accessibility, while also requiring users to make cash deposits if they want to play. This model has now been blown out of the water by sweepstakes casinos, though, transforming the iGaming space for young Gen Z and Millennial players.
With sweepstakes casinos, everything looks the same on the surface. You get the same slots from the likes of Hacksaw Gaming and BGaming, familiar game categories such as roulette and Plinko, and user interfaces that can barely be told apart. Yet when you dig deeper, sweepstakes casinos are a lot different than regular online casinos and have tapped into what younger gamblers have been searching for.
The first major difference is that sweepstakes casinos don’t let you bet real cash. Instead, you play using either Gold Coins (GCs) or Sweeps Coins (SCs). These virtual currencies serve two very different purposes.
With Gold Coins, they essentially let players access all of their favorite casino-style games for free. These coins have no value and are given out for free in huge amounts by these casinos, specifically to allow users the freedom just to play for fun and climb GC leaderboards.
It’s with Sweeps Coins where things get interesting. Any player who bets and wins enough SCs can then redeem those coins for prizes. These prizes include gift cards, cash transfers, merchandise, and more.
By adding a prize-winning element into the mix, it puts sweepstakes casinos in the same room as online casinos, just in a roundabout way. Players therefore still feel incentivised to play, as prizes are up for grabs. This is ultimately why countless players purchase available coin bundles, and according to this source it’s estimated that sweepstakes casinos will generate $20.5 billion from player coin purchases in 2026 alone.
At the same time, sweepstakes casinos are adding gamified elements like daily challenges, leaderboards, VIP programs, and free-entry tournaments to give players plenty to do whenever they log in, and it’s an innovative business model that’s working extremely well for them.
Sweepstakes casinos have, in effect, become the casinos for ‘gamers’ rather than just gamblers, allowing the likes of Chumba Casino, Stake.us, and other big names in the industry to gain over 1 million registered users each.
The Sweepstakes Casino Market is Currently Valued at $9.1 Billion
Off the back of this innovative model, the sweepstakes casino market has been able to hit a market value of $9.1 billion after experiencing rapid year-on-year growth since the start of the new decade.
A significant portion of this growth has been driven by the sweepstakes model itself, which especially has huge appeal to younger players, but it’s also been supported by other factors as well.
Near the top of the pile is the influx of celebrity endorsement deals, with rapper Drake helping to put the ‘Stake’ brand on the map as part of an alleged $100 million-a-year sponsorship deal to promote both the Stake crypto platform and Stake.us sweepstakes casino.
Paris Hilton has also formed her own marketing deal with WOW Vegas, whereas Ryan Seacrest and several others have been part of several promotions with the highly regarded Chumba Casino, a sweepstakes casino that’s been around for over a decade now.
A large number of Kick and Twitch streamers have also been using sweepstakes casinos for their popular streams, which has encouraged thousands of players to try out these casinos for themselves (‘Slots & Casino’ is consistently the 4th most-watched category on Kick alone).
Some sweepstakes casinos have even been able to strike major partnership deals, like the one Stake.us has with the UFC.
When you combine an exciting sweepstakes business model with some top-tier marketing, the current sweepstakes casino market is exactly what you get, and it’s easy to see why the vertical is booming.
California, New York, and Others Have Opted to Ban Sweepstakes Casinos
Despite how well the US sweepstakes casino market is doing, it’s not all plain sailing.
In fact, these casinos have got something of a legal headache to deal with at the moment following the recent rise of states passing bans against them.
Since last year, New York, California, Indiana, New Jersey, Maine, Michigan, and several others have taken action against sweepstakes casinos by passing legislative bills against them, leading to outright bans or heavy restrictions. This has caused slight player drop-offs and revenue hits in some areas, as both New York and California in particular had hundreds of thousands of existing sweepstakes casino players. And before the end of 2026, it’s likely that at least a couple of other states will also issue bans following recent movements.
New York Attorney General Letitia James claimed that “Online sweepstakes casinos are illegal, dangerous, and can seriously ruin people’s finances.” while celebrating the fact that the Empire State was one of America’s first major states to crackdown on these new casino sites.
The reason behind some states pushing back against the sweepstakes casino market is because they believe that sweepstakes casinos using dual-currency virtual coin models mimic online casinos too closely and should be treated the same way from a legal perspective, as players are technically given the option to purchase these virtual coins using their own money and use them as a substitute for prize gambling.
Not all states adopt this approach, though, which is why sweepstakes casinos remain legal in the vast majority of the US and the market sits above a $9 billion valuation as of 2026, with more growth projected to come.
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What First-Time Players Can Expect
For those yet to step foot inside an online sweepstakes casino before, you can expect a unique playing experience.
Instead of betting cash across slots, roulette, and other games, you’ll need to make a pick between Gold Coins or Sweeps Coins.
Daily missions, challenges, and tournaments are also available, while it’s even possible to communicate with other players through chat rooms and other social features (this is why sweepstakes casinos are often referred to as ‘social casinos’).
First-time players can also expect to be frequently given free coins through things like sign-up bonuses and Daily Login Rewards, which provide a way for them to play for free without having to deposit any of their own cash.
And if you’ve played in a regular online casino before, such as the FanDuel or DraftKings casinos, it’s not that much of a difficult transition to make, as sweepstakes casinos are extremely similar and offer practically identical game libraries, although some of the games come from different providers.
What Does the Future for Sweepstakes Casinos Look Like?
As it stands, the future of iGaming looks set to be largely dominated by sweepstakes casinos as they continue to reach new audiences.
These casinos are a serious hit with Gen Z and Millennial players, boasting a significant usage rate among Kick and Twitch streamers, too.
Backing from big-name pop culture figures like Drake, Adin Ross, Paris Hilton, and others has also put these casinos in an advantageous position.
For VGW, the parent company of Chumba Casino and LuckyLand Slots, two of the most popular sweepstakes casino options on the market, money is certainly going to keep coming through the door, and the company itself just recently grew its revenue to over a record-breaking $7 billion.
Unsurprisingly, new sweepstakes casinos are launching every single month and it’s even reached a point where there are over 250 standalone sweepstake casinos on the market, giving players an unparalleled level of choice.
Players are hooked and operators are desperate to keep taking advantage of what is one of iGaming’s most powerful verticals at the moment, so if there’s a market worth keeping an eye on, it’s this one.
