The state of New York is on the verge of officially approving Senator Joseph Addabbo's proposed bill banning sweepstakes casinos from operating. The bill now awaits the signature of the governor, and it will make New York the fourth state to ban online sweeps casinos after Montana, Nevada, and more recently, Connecticut.

New York is now just one signature away from becoming the fourth state this year to outlaw online sweepstakes casinos, following the unanimous passage of a sweeping bill in the state Assembly on Tuesday. The legislation, championed by Senator Joseph Addabbo, aims to ban dual-currency sweepstakes models frequently used by online casino-style platforms operating in legal gray zones.

A smooth path through the legislature

The bill, which had already advanced through the Senate with little opposition, was swapped in place of an identical version introduced in the Assembly by Assemblymember Carrie Woerner. Both bills sought to close loopholes that allow sweepstakes-based platforms to mimic real-money online gambling without state regulation or taxation.

Addabbo's version had easily passed the Racing, Gaming, and Wagering Committee in the Senate, which he chairs, before moving to a full floor vote last week. In the Assembly, Woerner's version passed through several committees unchallenged before being replaced by Addabbo's for final passage. Assemblymember Jarrett Gandolfo was the only legislator to ask for clarification, focusing on the bill's targeting of dual-currency systems - one of the key features of sweepstakes casinos that allow users to exchange "sweeps coins" for cash prizes. Woerner assured lawmakers that common customer loyalty programs, like those from Starbucks or airlines, would not fall under the ban, explaining that those programs do not convert points into cash.

Industry backlash grows

Not everyone is pleased with the bill's trajectory. Industry groups such as the Social and Promotional Games Association and the Social Games Leadership Alliance swiftly voiced their opposition, warning that the legislation could have broader implications than intended.

"This bill doesn't just target sweepstakes," said an SPGA spokesperson. "It sends a chilling message to anyone looking to invest in the next generation of gaming innovation. Nearly every form of online gaming we know today, including companies like FanDuel, began as pre-regulated concepts. This legislation criminalizes that innovation cycle."

Jeff Duncan, Executive Director of the SGLA, echoed similar concerns. Legislators raised legitimate questions about enforcement, federal legal conflicts, and unintended effects on mainstream promotions. But those questions remain unanswered because the bill was rushed through, Duncan noted. "By blurring the line between lawful sweepstakes promotions and illegal gambling, this legislation threatens a vibrant digital-entertainment sector while offering players no safer alternatives."

Legal pressure and national trends

New York’s legislative action follows mounting legal scrutiny of sweepstakes gaming models across the country. On June 6, New York Attorney General Letitia James revealed her office had issued cease-and-desist letters to 26 operators for offering 'sweeps coins' to state residents. That legal development gave lawmakers additional justification for accelerating the bill's passage.

Senator Addabbo also cited Connecticut's aggressive enforcement against sweepstakes operators, specifically the Department of Consumer Protection's decision to suspend High5Games and file over 1,000 criminal counts related to illegal gaming activity. Similar bans have already been signed into law this year in Montana, Nevada, and Connecticut.

Major operators began withdrawing early

Sensing the inevitable, some operators have already begun scaling back operations in New York. VGW, arguably the world's biggest sweepstakes gaming company and operator of Luckyland Slots, Chumba Casino, and Global Poker, reportedly initiated plans last month to remove its sweepstakes offerings from the New York market. That exit is expected to roll out gradually throughout the summer.

Despite New York's forward momentum, proponents of sweepstakes gaming have notched a few recent wins elsewhere. In Louisiana, Governor Jeff Landry vetoed a bill that had passed unanimously in both legislative chambers. A similar effort in Maryland failed to move beyond committee stage.

With the Assembly vote complete, the bill now awaits Governor Kathy Hochul’s signature. If signed into law, New York will join a growing list of states pushing back against online sweepstakes gaming - a trend that shows no sign of slowing.