USA Legislation Part 4 – Sweepstakes Poker in the US in 2026: Law Changes & Latest Developments
For a long time, sweepstakes poker US sites operated unchallenged. In most states, these operators were able to offer games with real-money prizes while avoiding the traditional mechanics of deposits and withdrawals , allowing them to stay on the right side of the legal line.
They did this utilizing a loophole of sorts, setting up their operations on the sweepstakes principle. Players could never deposit real money. Instead, they could purchase virtual chips (which had no actual value) and receive “free” tokens, which could be used to play the games and exchanged for real-money prizes.
The loophole is in the process. These free tokens are treated as sweepstakes entries, and they are never purchased directly. They are simply gifts to loyal customers who use the platform to play with play money.
We won’t go into details of how sweepstakes poker and casino sites operate, as that topic has been covered in depth over and over. Instead, we’ll focus on the most recent legal developments and how several US states have begun to catch up, changing their laws in recent years to place these operators outside the legal boundaries.
The State of Sweepstakes Poker US Laws in 2026
Sweepstakes poker and casino sites were available in almost every US state until fairly recently. However, in 2025 and 2026, we’ve seen a number of states take decisive measures to change their laws to close the loophole and make these operators explicitly illegal.
Michigan Sweepstakes Ban
Michigan was one of the first states to launch a campaign against sweepstakes operators, likely motivated by the fact that the state already has a legal, regulated online gambling market.
As early as August 2024, the Michigan Gaming Control Board issued cease and desist orders against several prominent operators in the state. This broad action forced all sweepstakes sites out of Michigan, as even those not listed decided to withdraw rather than face legal consequences down the line.
Not the best news for the players, but, as already mentioned, Michigan at least has regulated online casinos and poker rooms. PokerStars, WSOP, BetMGM Poker, and BetRivers Poker all operate in Michigan and share player pools with other regulated states.
New York Gets Rid of Sweepstakes Poker
In New York, the Attorney General went after sweepstakes casinos and poker operators in June 2025. The AG issued an opinion that the model violated NY gambling laws, identifying and shutting down 26 operators. This was a major blow to US sweepstakes poker, as New York is one of the most populous states in the country and one of the most attractive markets.
This was followed by a new bill, which was signed by the New York Governor in December 2025, that explicitly banned sweepstakes gambling.
As passed, the law threatens fines between $10,000 and $100,000 for violators, along with potential loss of gaming licenses and an inability to apply for one in the future. Unlike similar bills in other states, the one in NY doesn’t mention any potential prison time.
One silver lining is that this move may indicate the state is preparing to finally pass a law regulating online gambling, so NY poker players have some hope of gaining access to safe, fully regulated sites in the near future.
California Bans Sweepstakes Casinos in 2026
California, the most populous US state with over 39 million residents, also introduced a sweepstakes poker ban. The state passed a new bill in October 2025 that turned the proposed sweepstakes ban into law.
While the operators were given some leeway, that law came into full force on January 1, 2026, putting an end to sweepstakes poker in California.
The law applies not only to operators, but also to affiliates and payment processors. By wording the legislation this way, California lawmakers have made it clear that anyone who tries to offer, promote, or facilitate sweepstakes gaming could face serious consequences.
Those found in breach of the new law could face fines of up to $25,000 and up to one year in prison, so the state is taking a very serious stance against this type of gaming.
Unlike New York, there is no silver lining here. By all accounts, California is at least a few years away from actually regulating online poker and casino games. This means that all poker fans in the state, and there are many, are effectively restricted to playing on offshore sites.
New Jersey’s 2025 Anti-Sweepstakes Law
New Jersey is another state that has made sweepstakes poker and casino explicitly illegal. Lawmakers passed a new piece of legislation in August 2025, putting sweepstakes operators on the wrong side of legality.
The passage of the bill was rather controversial, with the Social Gaming Leadership Alliance calling it the “government overreach” and going directly against the will of its constituents. The bill proposes fines of up to $100,000 for first-time offenders and up to $250,000 for repeat offenders.
Despite the criticism, with the legislation in place, sweepstakes operators had no other option but to leave the Garden State. On the bright side, New Jersey offers state-licensed and regulated online poker and is part of the MSIGA.
Sites like PokerStars, WSOP Online, and BetMGM Poker are available in the state, and BetRivers Poker should soon be entering the New Jersey market as well. So, players have a fair few options at their disposal.
Montana Sweepstakes Poker Ban
Montana’s Senate Bill 555, which was signed into law on October 1, 2025, made it illegal for any unlicensed operators to offer any type of internet gaming to state residents.
The bill, which explicitly includes sweepstakes casinos and poker sites, threatens fines of up to $50,000 and a prison term of up to 10 years for violators.
With that, players in Montana were cut off from all platforms operating under the sweepstakes rules. Since the state does not currently have a legal framework for licensed online gambling, many worry that this will push players toward offshore and internationally-based crypto-style operators.
Connecticut Joins the Anti-Sweeps Movement
In October 2025, Connecticut’s Governor signed a bill that ended sweepstakes casinos and poker sites in the state. The bill included provisions that violators could be penalized with a fine of $5,000 and up to 5 years in prison.
Online gambling has been regulated in Connecticut for several years, but, as of 2026, there are no active poker sites available in the state. Thus, the sweepstakes ban has put many poker players in an unfavorable position, cutting their access to operators like Global Poker.
While there is virtually no chance that lawmakers will reverse this decision, there are some positive signs that the Constitution State could be getting a regulated poker site in the near future. That development would at least soften the blow.
The problem, however, is that CT is still not part of the MSIGA , and its current legal framework doesn’t allow for this eventuality. Thus, until this changes, even if a poker room were to launch, it would be limited to in-state players, at least for a while.
The Future of Sweepstakes Poker in the US in 2026 & Beyond
It’s clear that the climate in the United States in 2026 is becoming increasingly anti-sweepstakes. With a number of new states banning sweepstakes operators and joining the ranks of those that have long opposed them (like Nevada and Washington), things don’t look promising.
Other states, such as Virginia and Indiana, are considering laws to ban sweepstakes gaming. However, Indiana’s current bill features a special carve-out that would allow sweepstakes poker to continue as a separate category.
Although sweepstakes gambling currently remains available in 40+ states, the writing is on the wall. The model, which remained unchallenged for many years, is now under heavy scrutiny, with individual states taking a hard line against it.
Given how much the landscape has changed in less than a year, it’s not hard to envision this snowball effect continuing to accelerate. During 2026, we’re likely to see at least a few more US states pass their own anti-sweepstakes laws.
For poker fans, there is some hope that future pieces of legislation might follow in Indiana’s footsteps and place poker outside the broader scope.
With very few new states likely to launch regulated online poker in the near future and the sweepstakes poker market shrinking, the situation is not ideal. And while offshore sites are often criticized, there are quite a few reputable US friendly ones that allow players to enjoy the game they love.
This further proves that prohibition and bans are not the way forward. Regulation needs to consider the needs and wants of those it affects most – US poker players – and the sooner lawmakers understand that, the better.
