Are Online Sweepstakes Just A Fad?

Online sweepstakes casinos are a distinct sector within the iGaming industry, offering players the opportunity to play casino-type games without having to spend any real money. These casinos use virtual currencies and coins (called sweepstakes coins) to play casino games for real prizes.

The last few years have seen a big uptick in sweepstakes platforms, especially in the US, where online gambling remains restricted in most states. But, are these casinos just a fad or do they have a promising future?

What Are Sweepstakes Casinos?

Sweepstakes casinos are a type of social casino where players can enjoy slots and other casino games like roulette, blackjack, and sometimes poker. These popular platforms allow players to purchase or win in-game virtual currency to play games, and the virtual winnings can then be redeemed for prizes, gift cards, and, on rare occasions, cash.

The list of sweepstakes casinos provides a comprehensive guide to available platforms where players get the casino experience without wagering real money. These sites are legal in 48 states, with Washington and Idaho being the exceptions. This has made online gambling experiences more accessible in the US, as only seven states currently offer legalized iGaming:

1. Connecticut
2. Delaware
3. Michigan
4. New Jersey
5. Pennsylvania
6. Rhode Island
7. West Virginia

Sweepstakes are therefore a popular option for those living in states where lawmakers are still deliberating whether online casinos should be legalized or not. They’re also a good option for risk-averse gamblers who want to experience an exciting casino atmosphere without risking their own finances.

Mobile optimization of sweepstakes platforms has helped to grow the sector. People can access apps and mobile websites for quick sweepstakes sessions without having to commit too much time. This convenience, flexibility, and accessibility have contributed significantly to the gambling genre’s popularity.

The Growth Of Sweepstakes Casinos

The popularity of online sweepstakes platforms can be seen in the numbers. Between 2019 and 2022, the sector saw an 89% revenue growth, with $3.1 billion in purchases reported by the end of 2022. User engagement saw a 30% year-on-year increase, and the revenue is expected to reach $11 billion by the end of 2025.

Sweepstakes operators have always reported consistent growth, however, 2024 was a standout year for the sector as revenue hit $8 billion during the year. This marked a historic increase in both revenue and customer activity for these social platforms.

The Future Of Online Sweepstakes Casinos

From the figures mentioned above, it is evident that sweepstakes casinos are enjoying rapid growth in the US. And it appears this trajectory will continue.

The market is projected to continue to grow 11.5% each year, with the market value reaching $157.8 million by 2032, a significant growth from the $73 million market value in 2023.

Sweepstakes casinos are not without their challenges, though. One of the biggest hurdles faced by the sector is regulation and licensing. The American Gaming Association (AGA) has concerns around player protections as the sector is not as tightly regulated as other types of gambling. This lack of regulation has resulted in several legal battles and class action lawsuits involving major brands, Google and Apple, which are involved in payment systems on these platforms.

There was also a class action lawsuit in Delaware against VGW Holdings, which reportedly violated Kentucky gambling regulations.

The regulatory landscape around gambling is constantly changing, and operators need to remain updated with their jurisdiction’s latest laws to remain compliant. These ongoing challenges mean that the future of online sweepstakes platforms may see the industry adopting new business models to improve regulation.

However, these challenges are not impacting the growth of the sector and sweepstakes will likely continue to enjoy revenue and market value growth in the coming years. More states are seeing a push from lawmakers to legalize various types of online gambling and betting, which may open the door for the expansion of sweepstakes casinos.

Technological advancements, like virtual reality, mobile gaming developments, and live dealer games, will launch sweepstakes platforms into the future, allowing these sites to remain on trend and offer engaging casino experiences to players.

Wrapping Up

Online sweepstakes casinos are far from being a passing fad. Although they’re facing regulatory challenges, their continued growth, strong user engagement, and adoption of new technologies show real staying power.

The combination of legal accessibility in almost all US states, mobile platforms, and the ongoing appeal of social gaming keeps these platforms relevant. As the gambling landscape shifts through more states legalizing iGaming and technological advances, sweepstakes casinos are set to expand.

Rather than a brief trend that will last a few years, these platforms are becoming a staple in the iGaming industry, offering entertainment and financial opportunities without the risks of traditional gambling.