U.S. sweepstakes casinos are exploding in popularity, but is it sustainable?

By the numbers

According to a new report from marketing analytics firm Optimove, sweepstakes casinos grew their player base by an average of:

• 16% month-over-month in the second half of 2024

• Compared to just 5% for traditional online casinos

This prompts the question: ‘What is fueling this growth?’

While real-money online casinos are confined to just seven U.S. states, sweepstakes platforms operate in over 35, tapping into a much larger user base. 

Optimove calls them a “scalable, low-friction entry channel” for operators seeking to build national reach without waiting on legislation.

What growth isn’t showing you?

However, fast growth doesn’t mean strong revenue. 

The same report shows that sweepstakes casinos convert only 12% of new sign-ups into paying customers, compared to 51% for real-money casinos.

And those who do spend, by purchasing in-game coin bundles, spend significantly less. The average monthly deposit at a sweepstakes casino is $263, versus $878 at a real-money site.

Player engagement also starts slower. 

New sweeps players average 2.6 active days in their first month, compared to 4.3 days for online casino users. But long-term engagement nearly evens out, with both groups averaging around 7.5 days of play per month after a few months.

Metric	Sweepstakes Casinos	Real-Money Casinos
Conversion to First Deposit	12%	51%
Average Monthly Deposit	$263	$878
Avg. Betting Days (First Month)	2.6 days	4.3 days
Avg. Betting Days (Later Months)	7.4 days	7.5 days

Legal spotlight 

The explosive growth hasn’t gone unnoticed by regulators. 

In a major development, leading sweepstakes operator VGW have announced they are exiting New York, as lawmakers moved to challenge the platform’s legality.

Montana has passed legislation banning sweepstakes casinos outright, set to take effect this October. 

Meanwhile, New Jersey's Assembly advanced a bill to prohibit sweepstakes operators, citing concerns over consumer protection and market cannibalization.

Similar efforts are underway in Ohio, Louisiana, Connecticut, and Nevada, all aiming to close what they view as a legal loophole.

Strategic implications

For gaming companies, sweepstakes casinos have been a clever way to reach players in states where traditional online casinos aren’t allowed.

But that legal gray area is getting harder to rely on. More states are now pushing to ban sweepstakes sites altogether.

Supporters of these platforms, like the Social and Promotional Gaming Association (SPGA) say the model is legal because you don’t have to spend any money to play.

Still, with lawmakers in multiple states drafting bans, it’s clear many regulators don’t see it that way.

What does this mean for players?

For players, these bans could limit access to sweepstakes casinos that offer a low-cost, legal alternative to real-money gambling. Players who enjoy the flexibility of playing without mandatory deposits might find fewer options available as the legal landscape tightens.

Winning the battle...

Sweepstakes casinos are capitalizing on a unique moment: widespread access and lax regulation. But that same formula could also be their undoing.

With legislation moving fast and player protection in the spotlight, sweepstakes casinos are running out of time. The gold rush may be over before it really begins.