Montana becomes first US state to ban sweepstakes casinos
Montana has become the first U.S. state to ban sweepstakes casinos. Governor Greg Gianforte signed Senate Bill 555 (SB 555) into law. The ban will take effect on 1 October 2025, requiring sweepstakes casino operators to leave Montana by that date. This new legislation is expected to have significant impacts on players and online gambling platforms and potentially influence other states’ policies.
How SB 555 changes the game?
Sweepstakes casinos use a dual-currency system to bypass gambling laws. “Gold Coins” are for fun and have no real value, while “Sweeps Coins” can be redeemed for prizes or cash. This setup allowed these platforms to operate in a legal grey area, as users weren’t technically gambling real money.
SB 555 redefines internet gambling to include any platform that transmits or receives gambling information, allows bets using any form of currency, and makes payouts in any form of currency. This means sweepstakes casinos can no longer hide behind in-game tokens.
The bill states, “The term internet gambling includes online casinos, by whatever name known, which constitute internet gambling and are prohibited. This includes but is not limited to any platform, website, or application that knowingly transmits or receives gambling information, allows consumers to place a bet or wager using any form of currency, and makes payouts of any form of currency.”
Legislative journey of SB 555
SB 555 was introduced in late March 2025 and assigned to the Business, Labour, and Economic Affairs Committee. It quickly gained support and moved through the legislative process. By April, the bill had passed the Senate, and shortly after, the House approved it with little opposition, showing strong support against internet gambling. SB 555 became law in just under two months, a notably fast pace for legislation. Violating SB 555 can result in fines of up to $50,000 and up to 10 years in prison. Montana is making it clear that online gambling is not welcome.
SPGA’s arguments against the bill
The Social and Promotional Games Association (SPGA) didn’t take the news lightly. A spokesperson criticised the bill, claiming it unfairly lumps harmless promotional games with high-stakes gambling.
A spokesperson commented, “The SPGA strongly condemns the enactment of Senate Bill 555, which makes Montana the first state to ban online sweepstakes-style games, without even using the word sweepstakes.”
SB 555 reclassifies free-to-play promotional games as “internet gambling,” disregarding the legal and operational differences between sweepstakes platforms and real-money online casinos. Even platforms with no purchase required and strong consumer protections could face criminal penalties under this law.
Legal grey areas of sweepstakes casinos
While players technically don’t need to spend money to play sweepstakes games, most do. This allowed operators to argue their legality. By offering free ways to win, these platforms avoided being classified as gambling. However, Montana’s new bill closes this loophole with precise legal language.
Recent bills to ban sweepstakes casinos have failed in Arkansas, Florida, Mississippi, and Maryland. While Montana is the first state to address this model, Washington and Idaho have already banned most forms of online gambling. In Washington, a sweepstakes casino paid a $25 million settlement after a lawsuit.
Similar bills targeting dual-currency casinos are currently active in New York, New Jersey, Connecticut, and Louisiana.
Montana’s gambling landscape
Montana allows gambling through state-regulated and tribal channels. Sweepstakes were a workaround until now. The only legal sports betting option is Sports Bet Montana, which is run by the state. Montana has over 1,400 licensed operators and more than 16,000 gaming machines, creating a bustling gambling scene without online casinos.
