Tennessee has introduced a statewide ban on online sweepstakes casino platforms after Governor Bill Lee signed new legislation targeting operators that use dual-currency systems and casino-style products operating outside the state’s regulated gambling framework.
The law officially came into effect on May 22 following the approval of HB 1885/SB 2136 on April 23, the final day of the legislative session. The bill was then forwarded to the governor on May 11 and received final approval within the standard 10-day review window.
The legislation focuses on online gaming products that replicate traditional gambling formats through virtual currencies or hybrid currency systems. Tennessee’s updated rules cover platforms offering slot-style games, online table games, bingo-style products, lottery simulations, video poker, and unauthorized sports betting services.
Any violations will now be prosecuted under the Tennessee Consumer Protection Act of 1977. During the legislative process, lawmakers also strengthened enforcement provisions, granting regulators broader authority to investigate suspected operators and enforce compliance.
Gambling Platforms Begin Exiting Tennessee
The new law follows several months of increasing regulatory pressure on sweepstakes casino operators operating in the state. In late 2025, Tennessee Attorney General Jonathan Skrmetti issued cease-and-desist orders to multiple companies providing sweepstakes-style gaming services to local users.
Following these actions, several operators began restricting or fully withdrawing access in Tennessee. Affected platforms included Chumba Casino, Fortune Coins, Global Poker, Hello Millions, High 5 Casino, Stake, WOW Vegas, Sportzino, Luckyland, McLuck, Modo, and Zula Casino.
A1 Development also halted services for Tennessee users across multiple brands, including NoLimitCoins, Fortune Wheelz, Tao Fortune, FunzCity, Funrize, and Storm Rush.
Other companies responded by scaling back their sweepstakes offerings as regulatory scrutiny increased. VGW, the parent company of Chumba Casino, LuckyLand Slots, and Global Poker, reduced Sweeps Coin gameplay availability in Tennessee. Stake.us later confirmed its exit from the state, while social sportsbook platforms such as Thrillzz, KicKr, and Rebet also withdrew from the market.
These exits reflect growing uncertainty over how Tennessee regulators would interpret prize-based gaming systems and dual-currency mechanics. Operators have continued adjusting their services as legal pressure increases across the United States.
Attorney General Skrmetti previously criticized the sector, stating: “The only thing you can be sure about with an online sweepstakes casino is that it’s going to take your money.”
He further added: “They work hard to make these sweepstakes casinos look legitimate, but at the end of the day they are not. They avoid any oversight that could ensure honesty or fairness. Our Office was glad to chase these shady operations out of Tennessee and will keep working to protect Tennesseans from illegal gambling.”
He also warned that “illegal gambling will not be tolerated” in the state.
More States Continue Targeting Dual-Currency Gaming
Tennessee’s decision is part of a broader regulatory trend across the United States targeting sweepstakes casinos and dual-currency gaming models. Regulators in multiple jurisdictions argue that these systems effectively replicate real-money gambling despite relying on virtual currencies instead of direct cash wagering.
States including California, Connecticut, Louisiana, Montana, New Jersey, New York, Oklahoma, Indiana, Maine, and Nevada have also introduced or passed legislation aimed at restricting sweepstakes-style casino operations.
Louisiana recently joined this movement after Governor Jeff Landry signed House Bill 883 into law, with the new rules set to take effect on August 1.
The conference committee report accompanying Tennessee’s legislation defines sweepstakes casinos as platforms that “use a system allowing players to engage in casino-style games with virtual currency and redeem that currency for cash or other real-world rewards.”
It further notes that these structures act as “a façade designed to obscure the reality that users may be participating in real-money gambling through the purchase and use of virtual credits.”
Supporters of the law argue that it closes regulatory loopholes that previously allowed operators to offer casino-style experiences without oversight equivalent to licensed gambling businesses. Legislative analysis also concluded that the measure would not negatively impact state revenue.
The ongoing debate over sweepstakes casinos continues to grow across the U.S., as more lawmakers and regulators evaluate how dual-currency gaming models function and whether they should be governed under existing gambling regulations.
