Sweepstakes casinos have become a little more popular than people expected.
Sweeps Casinos – Latest Trend in U.S. Casino Market
Sweeps Casinos are becoming very popular among the casino players
Sweepstakes casinos are enjoying quite the boom at the moment. Stake.us, Chumba Casino, and WOW Vegas are just some of the names you’ve probably heard of by now, with the Drake-backed Stake, who reportedly pay the Canadian rapper $100m a year to promote them, being the hottest site. And you only have to spend a few seconds on Kick or Twitch to see countless streamers playing in these casinos.
If you didn’t know already, sweeps casinos are a new type of online casino that follow a “freemium” model. In other words, all of the games are free-to-play. For anyone scratching their heads wondering how a free casino can even work to begin with, you’re not alone, so we’ll dig into that soon.
As we speak, the sweepstakes casino market is valued at around $5.6bn by Eilers & Krejcik Gaming (EKG). These sites are raking in big money and even putting some of the regular online casinos out of business, so you’d assume things couldn’t be going better for them. However, they’re also surrounded by growing controversy, with all of that and more unpacked right here.
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What Are Sweepstakes Casinos?
Sweepstakes casinos let you play all your favorite casino games for free, while also providing the opportunity to win prizes like cash and gifts cards. The games range from slots to blackjack, coming from all the online casino industry’s leading software game developers, like Betsoft and NetEnt. Almost everything is the same, really, except you’re placing bets with virtual GOLD COINS (GC) and SWEEPS COINS (SC) instead of actual money.
After creating an account with your chosen casino, you’ll usually receive a welcome package of Gold Coins and Sweeps Coins. If you take a look at Chumba Casino, they give you 2,000,000 GC + 2 SC just for signing up. The Gold Coins can be used to play any of the games you like for FREE, while the Sweeps Coins are for winning real prizes. This is why sweepstakes casinos give you lots of Gold Coins when you first sign up but only a small number of Sweeps Coins.
If you want to play just for entertainment, then you’ll use Gold Coins. But if you’re a competitive player, or perhaps someone with previous gambling experience, you’ll probably want to bet your Sweeps Coins instead. And of course, the more of these coins you collect, the more prizes you can redeem. On average, 1 SC converts to $1, so if you decided to play Sugar Rush slot and won 200 Sweeps Coins, you’d be able to redeem $200 worth of gift cards, or around that.
Sweeps casinos are extremely big on tournaments and leaderboards. There are weekly tournaments going on all the time, especially for games like blackjack, and you also have the opportunity to climb fun leaderboards. Essentially, there’s something for everyone to do, even the casual players.
Not to mention, WOW Vegas and a few other sweepstakes casinos also have what’s called progressive jackpots. With WOW Vegas, they have site-wide GRAND, MAJOR, MINI, AND MINOR jackpots, all of which keep getting bigger until somebody wins them. Just last week, user Kimberly0787 won a MAJOR jackpot of SC 109,675 while spinning the Brilliant Gems slot, which is just shy of $110,000.
Ultimately, that’s the appeal of sweepstakes casino sites: they’re a lot of fun and you never know when a big win like that might suddenly strike.
Sweepstakes Casinos Have Experienced Explosive Growth Since 2020, With Stake.us, Chumba Casino, and WOW Vegas Dominating
With all that covered, you begin to see why sweepstakes casinos have experienced such explosive growth over the past half-decade. They are, essentially, the entertainment version of traditional online casinos, but with the chance to win prizes still thrown on top. And when a concept like this starts reaching Gen Z and Millenials, you suddenly have companies like VGW, who own Chumba Casino and LuckyLand Slots, pulling in $6.15bn revenue in 2024.
Chumba Casino itself also has “over 1 million users”, with Stake.us similarly also surpassing the 1 million registered users mark following its rapid expansion through North America and signing Drake up as part of its marketing efforts. Simply put, the sweepstakes casinos market is the place to be right now, and it’s got traditional gambling sites a tad worried that their players are getting stolen away from them.
The truth is that sweepstakes casinos did sort of get a lucky break back in 2020 when the COVID-19 pandemic happened. As you’ll no doubt remember, people were locked down in their homes with much less money than usual, so they needed some free entertainment. This is where sweepstakes casinos stepped in, capitalizing off the slow rise in popularity they’d already been experiencing since around 2015 (Stake’s Ed Craven described the pandemic as like putting “rocket boosters on the operation” for his brand). Since then, it’s been nothing but growth after growth for these sites, even reaching a point where there are now over 100 unique sweepstakes casinos available to sign up with on the internet.
The Growing Sweepstakes Casino Controversy
From 2020 up until last year, sweepstakes casinos were, indeed, flying. However, what’s happened is that these relatively new casinos have suddenly come under extreme pressure from both a growing number of U.S. states and players. And it’s all to do with the “Sweeps Coins”.
We mentioned earlier that sweepstakes casinos are free-to-play. Quite literally all of them let you play their games without betting a penny. But the problem is that every sweepstakes casino also lets you win prizes using Sweeps Coins, and if you don’t have enough Sweeps Coins to bet, they let you purchase coin packages with your own money. In a sense, what this means is that you’re actually gambling, as all you’ve done is switch out real money for Sweeps Coins, which you’ll then potentially redeem for prizes once you’ve collected enough of them.
The American Gaming Association and a growing number of U.S. states have now clocked this and started to call it out. In a nutshell, they think sweepstakes casinos are gambling sites and should follow the same laws as traditional online gambling sites, with both Minnesota and Connecticut already having passed bills into law to block sweepstakes casinos from operating there.
At the same time, several sweepstakes casinos have had recent lawsuits arrive at their doorsteps. There are many states filing lawsuits, but most fail at the moment due the legal “grey area” that surrounds these casinos. However, High 5 Casino, one of the most popular operators, did recently lose a lawsuit when a Washington state jury ordered the sweepstakes casino to payout $25m in damages to players following a verdict that the casino itself was violating state gambling laws, showing that these sites aren’t as legally protected as they thought they were.
More States Looking to Ban Sweeps Casinos, Including California and New York
Currently, there are around 10 states, including New York and California, who have put together their own bills to ban sweepstakes casinos (as we talk, New York has just recently served cease-and-desist letters to all sweepstakes casinos operating in the Empire State). If these bills are successfully passed into law, there could be an outcome on the horizon where sweepstakes casinos are only legal in less than 40 states, whereas before they were legal in pretty much all of them. It’s a major shake-up, and one that’ll be interesting to watch unfold over the coming years.
What’s Next for America’s New Favorite Casinos?
While millions of players keep signing up with the likes of Chumba Casino and Drake continues to pick up his $100m a year bag of cash from Stake, the future looks bright for this fast-growing iGaming sweepstakes market. However, what recent lawsuits and state bill filings have shown is that sweeps casinos will have to play by the book if they want to keep operating freely. And for now, at least, it seems like that’s what will happen.
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Kristyna Baranova
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