Published on: January 13, 2026, at 02:47h.
Updated on: January 13, 2026, at 02:47h.
- Maryland Legislation Aiming to Outlaw Online Sweepstakes Casinos
- Online gambling remains illegal in Maryland; however, some unregulated sweepstakes continue to function
As Maryland legislators assemble tomorrow for their 2026 session, which continues until April 13, two separate proposals aimed at banning contentious online sweepstakes casinos in the state have already been introduced.
House Bill 295 and Senate Bill 112 are corresponding measures featuring the same language. These bills seek to eliminate illegal markets in interactive online gaming.
HB295/SB112 would unmistakably prohibit sweepstakes casinos that implement dual or multiple currency systems allowing players to “exchange currency for any prize, award, or cash equivalent.”
These measures are being introduced following a request from Governor Wes Moore (D), who responded to the Maryland Lottery and Gaming Control Commission’s appeals for legislation to ban sweepstakes casinos. The state’s gaming regulator reports that while several prominent sweepstakes casinos like Chumba, Stake, and Modo have complied with cease and desist orders, numerous others continue to operate without restriction. With these operators persistently emerging, the state’s lottery and gaming authority contends a law is pivotal to outlaws these businesses.
Understanding Dual-Currency Casinos
Advocates for sweepstakes casinos, represented by the Social Gaming Leadership Alliance, assert that they run free-to-play social gaming platforms and applications. Users are provided free “gold” coins, which are not convertible to real money.
While the social gaming features of sweepstakes casinos allow users to play indefinitely without financial deposits, the availability of another digital currency—commonly referred to as sweeps coins—enables players to compete for real money. To encourage users to shift from social to real money gaming, these websites often credit the players with a few sweeps coins.
Additional sweeps coins can be purchased, with each coin equivalent to one dollar. Although sweepstakes casinos maintain that sweeps coins can’t be cashed out in the usual gambling manner, they can be “redeemed” for cash rewards. This loophole allows them to claim they are conducting promotional sweepstakes similar to CVS’s earlier flu shot promotion that provided customers with chances to win various prizes.
However, state attorneys general, lawmakers, and gaming regulators widely dispute the claims made by the sweepstakes casino industry regarding compliance with online gambling laws. The Maryland Lottery and Gaming Control Commission is one such agency opposing these claims.
These offerings encompass gaming elements: consideration, chance, and prizes. Hence, it qualifies as gaming,” noted Michael Eaton, managing director of gaming at the state agency, in correspondence with Chumba in November 2025.
“According to Maryland law, gaming is illegal unless explicitly authorized. The activities you’ve provided on your site are not legally sanctioned in Maryland,” Eaton clarified.
Potential Penalties for Violators
The proposed bills in Maryland set forth stringent penalties for those who violate regulations against sweepstakes casinos.
Individuals convicted of breaching the state’s sweepstakes and/or illegal online gambling statutes could face a misdemeanor charge along with a prison term of up to three years. Additionally, fines could range from $10,000 to $100,000 for each offense.