New York Bill Targets Online Sweepstakes Casinos with Ban and Enforcement Mandate

🗂️ Summary

New York Aims to Shut Down Dual-Currency Sweepstakes Casinos

Senate Bill S5935A just hit the floor in Albany, and it’s aiming straight at the heart of the sweepstakes casino model. Filed by Senator Joseph Addabbo Jr. on March 4, 2025, the proposal would ban any online game that runs on a dual-currency system – especially if those coins can be traded in for cash, prizes, or anything close.

The bill’s language leaves little wiggle room: if players can convert in-game currency into real-world value, the platform’s on the wrong side of the law. That’s a direct shot at a market that’s thrived in legal limbo – hovering somewhere between no-cash giveaways and thinly veiled gambling.

Not Just a Ban-A Mandate for Enforcement

The proposal doesn’t stop at prohibition. S5935A charges the New York State Gaming Commission and the Attorney General with active enforcement. Their directive? Deny licenses, suspend operations, and initiate penalties against individuals or entities-or their affiliates-who knowingly generate revenue from illegal sweepstakes models.

Importantly, the bill asserts jurisdiction over both operators and promotional partners. This could mean media platforms, casino payment processors, or even advertisers could fall within regulatory crosshairs if found supporting these prohibited systems.

Implications for Sweepstakes Casino Operators

The key legal pressure point in S5935A is its definition of “online sweepstakes game.” It specifically targets platforms that allow dual-currency play – one free, one purchasable – if either form can be exchanged for a cash prize, a cash equivalent, or a chance at either.

This definition effectively shuts the door on the core business model of many sweepstakes-style casinos. Even those relying on promotional coins or virtual currencies would be in violation if those credits can be cashed out, converted, or used to trigger real-world winnings.

That includes operators using third-party gift card redemptions or crypto withdrawals as “off-platform” cashout routes. If the game allows any pathway to real-money value, it’s caught in the dragnet.

Compliance Window? Not Likely.

Unlike some reform efforts that phase in compliance timelines, S5935A offers no grace period. It demands that the state “deny a person from commencing or continuing operations” if they accept revenue tied directly or indirectly to prohibited sweepstakes models.

That leaves very little wiggle room for compliance strategies. Operators would need to immediately de-cashify their mechanics or risk administrative and legal action. Platforms that rely solely on engagement-based prize pools – without purchasable currency – may be safer under the current definition, but even they must tread carefully.

And Looking Ahead?

As of mid-May 2025, the bill remains active and awaiting a full Senate vote. A mirror bill, A6745, is already progressing through the Assembly. Should both versions pass, enforcement would begin upon gubernatorial signature.

For sweepstakes casino operators eyeing the New York market, the writing is on the wall. Without a fundamental shift in their business models, they may soon find themselves on the wrong side of state law – with the full weight of the Gaming Commission and Attorney General’s office prepared to act.

Learn More

Curious who’s in the crosshairs? Our breakdown of New York’s sweepstakes casino scene covers the big names, the legal landmines, and what’s likely to change if this bill crosses the finish line. If you operate – or play – in the Empire State, you’ll want to read this first.

📚 Sources

• New York State Senate. (2025). Bill S5935A: Prohibit online sweepstakes games and revenue from illegal markets. Link