The Tennessee and Oklahoma Senates have passed bills targeting dual-currency sweepstakes casinos, accelerating a widening state-level crackdown on unregulated online gaming platforms.
The Tennessee and Oklahoma Senates have passed bills targeting sweepstakes casinos. The votes mark the latest escalation in a rapidly expanding state-level crackdown on unregulated dual-currency platforms.
Tennessee Targets “Online Sweepstakes” Games
In Tennessee, Senate Bill 2136 takes a consumer protection approach. It adds new provisions within the Tennessee Consumer Protection Act. The bill defines an “online sweepstakes game” as gambling conducted online that:
“Utilizes a virtual-currency system allowing a player to… Exchange the currency for a prize, award, cash, or cash equivalent, or the chance to win a prize, award, cash, or cash equivalent.”
The legislation further states:
“Gambling; the operation or possession of gambling devices; and the operation, conducting, or commercial promoting of online sweepstakes games and other forms of online or app-based gambling are unlawful and are offenses against the public health, safety, and welfare of this state.”
The bill classifies violations as unfair or deceptive acts under the Tennessee Consumer Protection Act. This structure empowers the attorney general with “the tools to properly investigate violations of law, including illegal gambling.”
Attorney General Jonathan Skrmetti has already acted against sweepstakes casinos. At the end of December 2025, he announced that his office had issued cease-and-desist letters to nearly 40 online sweepstakes casinos operating in the state, forcing many major operators to exit the state.
SB 2136 now moves to the House, which is also considering its companion bill, HB 1885, which could fold into the Senate measure. If enacted, SB 2136 would take effect immediately upon becoming law.
Oklahoma Expands Criminal Gambling Statute
Oklahoma’s Senate Bill 1589 amends the state’s gambling statute to explicitly include online casino-style offerings.
The bill defines “online casino games” as:
“Any gambling game that allows a person to access the Internet… that, upon risking any representative of value, simulates any gambling game described in this section or any other form of gambling, including… a slot machine…”
It also clarifies that a “representative of value” includes:
“Any and all currency used as part of a dual-currency system of payment that allows a person to exchange such currency for any prize, award, cash, or cash equivalent…”
SB 1589 extends liability beyond operators. It also applies to any “geolocation provider, gaming supplier, platform provider, promoter, or media affiliate” who “deals or provides support” for those games.
Violations would be punished as Class C2 felonies, with fines of $500 to $2,000 and potential imprisonment.
The bill now moves to the House. The chamber is also considering HB 4130, a similar measure that has already passed two committees. The two bills’ advancement signals alignment in the two chambers on the matter.
If enacted, SB 1589 would take effect on Nov. 1, 2026.
Part of a Broader Multi-State Trend
The Tennessee and Oklahoma Senate votes mark the latest action against sweepstakes casinos nationwide.
In Indiana, the Legislature passed HB 1052, explicitly banning dual-currency sweepstakes casinos. The measure now awaits the governor’s signature.
At the beginning of February, the Mississippi Senate passed an explicit ban on sweepstakes casinos. However, the measure has stalled in the House.
Meanwhile, last week, the Iowa Senate passed an enforcement-expansion bill that grants the Iowa Racing & Gaming Commission clearer authority to pursue illegal sweepstakes operators.
Elsewhere, Utah lawmakers passed two measures that do not directly target sweepstakes casinos but expand enforcement authority under both criminal statutes and consumer protection laws. Given Utah’s strong anti-gambling stance, regulators could use the updated laws to target sweepstakes casinos.
Two separate online casino bills in Virginia, with provisions to prohibit sweepstakes casinos, are advancing in the opposite chambers after passing in their original chamber. However, even if lawmakers pass either of them this year, they must do so again in 2027 with a potential enactment in 2028.
Bills explicitly targeting sweepstakes casinos or empowering regulators to pursue illegal operators are also active in Maine, Florida, Maryland, Louisiana, New York, and Illinois.
Collectively, these measures signal an increasingly coordinated state response to online sweepstakes casinos.
As more states clarify that dual-currency sweepstakes models fall within existing gambling prohibitions or consumer protection statutes, regulatory pressure on unlicensed operators continues to intensify heading into the 2026 legislative cycle.
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