SWEEPSTAKES
that explicitly cover or prohibit sweepstakes offerings. This creates room for legally compliant offerings, but at the same time requires operators to design their model carefully and in accordance with the existing requirements of the Interstate Treaty on Gambling 2021 (the “IST 2021”). An unchanged or insufficiently thought-out approach runs the risk of falling under national gambling regulations and thus being prohibited. Germany therefore offers a genuine opportunity for sweepstakes operators, but only for those willing to design their offerings to be legally compliant from the outset. This article first provides an overview of the sweepstakes model and its basic structure, then examines regulatory developments in the U.S., and finally delves into the German legal landscape in detail. The focus is on the question of under what conditions a sweepstakes offering is permissible in Germany and which specific requirements, particularly those under gambling law, must be observed. The sweepstakes model: basic structure and forms Sweepstakes casinos are online platforms that offer players a casino-like experience without being classified as gambling in the legal sense. Their defining feature is the so-called dual- currency system: on these platforms, two different virtual currencies typically coexist. One of these – hereinafter referred to as “Social Coins” – is used exclusively for gaming entertainment and cannot be exchanged for either cash or prizes of monetary value. The other currency (hereinafter referred to as “Sweep Coins”) can, however, be redeemed for cash or non-cash prizes under certain conditions and is thus the component relevant under gambling law. Classic casino games such as virtual slot machines are replicated on the platform and played by registered users. The games are played entirely with virtual currency, not with real money. Depending on the structure of the offering, both types of coins can be acquired free of charge in a variety of ways. Only Social Coins can also be purchased with real money. As soon as a player
receives Sweep Coins in addition to purchasing Social Coins, this may have consequences under gambling law, depending on the specific case.
Regulatory dynamics in the United States: from tolerance to prohibition The sweepstakes concept originated in the North America, where it has been known as a marketing tool for decades. The legal structure of free participation (e.g., by mailing in a postcard) was long considered an effective means of circumventing the strict gambling laws of most U.S. states. However, due to the increasing success and diverse formats of sweepstakes offerings, various states have responded with regulatory action in recent months. As early as 2025, six states 4 took measures against sweepstakes casinos. 5 This trend has accelerated further in 2026. Formal bans on sweepstakes casinos were enacted in the states of Maine and Indiana. 6 Particularly revealing are the legislative definitions used in these laws. The legislation in Maine, for example, explicitly defines dual-currency systems as well as direct consideration, thereby targeting the business model of sweepstakes casinos. 7 “Online sweepstakes game” means any game, contest, or promotion that: A. Is available on the Internet and accessible via a mobile phone, computer terminal, or similar access device; B. Uses a dual-currency payment system; and C. Simulates casino-style gaming, including, but not limited to, slot machines, poker, and other table games, lottery games, bingo, or sports betting. 8 The penalties for violating this provision are also severe: “A person who operates or promotes an online sweepstakes game, or supports the operation or promotion of an online sweepstakes game, commits a civil violation. 1. Fine. A person who violates this section is subject to a fine of not less than $10,000 and not more than $100,000. All fines
4 California, New York, New Jersey, Connecticut, Nevada, and Montana; in addition, Washington, Idaho, and Michigan had long been considered off-limits for sweepstakes operators 5 Schroth , GamblingInsider, April 8, 2026, https://www.gamblinginsider.com/de/news/102556/maine-usa-verbietet-sweepstakes-casinos-gou- verneurin-unterzeichnet-gesetz-ld-2007 6 Ibid 7 Ibid 8 S.P. 825 - L.D. 2007 An Act Regarding the Prohibition of Online Sweepstakes Games https://legiscan.com/ME/text/LD2007/2025
IMGL MAGAZINE | JUNE 2026
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