A Sweeping Decision: Tennessee’s Attorney General Shuts Down Online Sweepstake Casinos

To close out 2025, Tennessee’s Attorney General Johnathan Skrmetti closed nearly 40 online sweepstakes operators. This decision is a fitting end for the year, as many states have cracked down on such casinos to curb unregulated gambling. This article will go into the details of this move and how it will affect the industry and players.

Tennessee Cracks Down on Online Sweepstakes

At the end of 2025, Attorney General Skrmetti announced that nearly 40 online sweepstakes casinos had been shut down. They were sent cease-and-desist letters and willingly complied with the order by stopping activities or removing any illegal elements. The AG’s office also released the list of operators who complied, which includes:

• Chumba
• McLuck
• WOW Vegas
• High 5 Casino
• Stake
• LoneStar

The AG states that while these casinos may appear legitimate, they are actually illegal sites that evade oversight. Their dual-currency system exists to conceal the fact that users can gamble with real money. According to Skrmetti, these casinos are illicit lotteries that violate the state’s gambling laws dedicated to protecting players.

2025: A Bad Year for Sweepstake Casinos

This decision is a fitting cap on the US’s sentiment towards sweepstakes casinos throughout 2025. Many states, like California, have issued bans on sweepstakes casinos, as their dual currencies allow them to circumvent gambling regulations. Most states have decided to outright ban these sites, rather than creating new legislation.

“Rarely do we agree on anything as lawmakers, but on this issue, we agree that this represents illegal gambling operations.”

Shawn Fluharty, West Virginia Delegate

Even states like Mississippi and Maryland, while not issuing complete bans, sent over 100 cease-and-desist letters throughout 2025. While most operators have been compliant, many have expressed interest in new legislation that would allow them to continue operating and providing the government with tax revenue. However, lawmakers believe it’s too late and differentiating sweepstake casinos from gambling isn’t a good idea.

2026: Future of Sweepstakes

The future of sweepstakes casinos isn’t looking any brighter as state crackdowns continue. Florida, Maine, and Indiana are preparing various bills that would ban sweepstake casinos and introduce penalties. For example, Maine would fine operators up to $100,000, while Florida is increasing the Seminole Tribe’s monopoly. The Social Gaming Leadership Alliance is opposed to Florida’s bill, with its executive director believing it could harm legitimate events.

“We strongly disagree with the categorisation that Social Plus games that utilise sweepstakes promotions have anything in common with illegal offshore gambling operations.”

Jeff Duncan, SGLA Executive Director

Meanwhile, many operators and even suppliers, such as Pragmatic Play, have left the US market since the sweepstakes ban. They will now explore other avenues to enter the market, although it may take some time to obtain proper licensing. Nevertheless, the new bills are still being considered, so it remains to be seen how they will impact the industry.

The Industry Looks Towards the New Year

Aside from sweepstakes, other issues will need to be addressed in the future. One of the biggest ones is prediction markets, as state regulators continue their legal battles with sites like Kalshi. It’s becoming increasingly clear that the Supreme Court will need to step in to help resolve the problem stemming from the rampant growth of prediction markets.

“The US market operates at different levels of maturity, and while state expansion has slowed, existing markets continue to grow.”

Charmaine Hogan, Global Head of Government Relations, Playtech

Meanwhile, operators are trying to compete with this new form of betting by introducing their own prediction markets to sportsbooks. However, they have to be extremely careful as regulators like the MGCB have warned sportsbooks not to operate prediction markets. Gaming’s reputation has also waned, and many regulators are introducing stricter rules, which will pose additional challenges.

Conclusion

Sweepstake casinos had a turbulent year, and Tennessee’s decision is likely a precursor to further regulation. As the rules become stricter and sweepstake casinos continue to be pushed out of the market, many operators will have to adapt and consider other products. It remains to be seen how the industry will change this year.