California is the latest state to ban sweepstakes casinos. Governor Gavin Newsom signed AB831 into law on October 11, meaning the ban will be effective as of January 1, 2026.
Outlawing social casinos is becoming a growing trend across the United States. However, California is going to have the biggest impact due to its population of over 39.4 million residents. By comparison, New York has a population of just under 20 million. According to a recent report by Eilers & Krejcik Gaming, California accounts for about 17% of the total U.S. sweepstakes industry revenue.
Sweepstakes or social casinos offer slots, live dealer games, and table games just like real-money online casinos. The big difference is players can’t win real money. Operators use a dual currency model consisting of gold coins (no real money value) and sweeps coins (redeemable for gift cards and cash prizes).
The anti-sweeps bill rapidly moved forward since being introduced by Asm. Avelino Valencia. In July, it passed the Senate Governmental Organizational Committee by a 10-0 vote. It also unanimously advanced out of the Senate Appropriations Committee by a 7-0 vote. The Senate (36-0) and State Assembly (63-0) strongly supported the bill as well.
Sweepstakes brands aren’t waiting until January 1 to exit the California market. Ruby Sweeps decided to leave California in September. High 5 Casino, Carnival Citi, and Dora Casino have ceased operations in the Golden State as well. Time will tell how many other brands follow by making an early exit.
The Social Gaming Leadership Alliance (SGLA) pushed for Newsom to veto the sweepstakes casino bill. The organization even sent an open letter to the California governor’s desk regarding the positive benefits a thriving sweepstakes industry can have on the state’s economy. The SGLA even proposed working together to find common ground.
“California has always been a leader in innovation, not a place where opportunity is shut down overnight,” SGLA Executive Director Jeff Duncan said. “We urge the governor to veto this reckless bill and work with us to create smart, consumer-focused regulation that strengthens California’s economy and protects its leadership.”
The SGLA also released survey results showing overwhelming support against a California sweepstakes casino ban. It included how 85% agreed that California should modernize and update laws to regulate and tax online social gaming. Additionally, 77% of Californians believed the sweepstakes industry should continue operating.
The SGLA has not released a response to Newsom signing the bill.
California joins a growing list of U.S. jurisdictions closing the door on the sweepstakes casino industry. Montana’s online gambling ban took effect on October 1. Add California, and the total number of banned states is now up to nine in which the platforms have either been banned or a bill has been passed.
Here is the current list of impacted states:
