Pragmatic Play has decided to pull the plug on the supply of its games to U.S. sweepstakes casinos after a Los Angeles civil suit was filed against Stake.us. The enforcement action names Pragmatic among several other game suppliers, despite the fact that the company isn’t active in the licensed U.S. iGaming market.
Key Takeaways
- Pragmatic Play has decided to stop supplying its games to U.S. sweepstakes casinos
- This decision might signal Pragmatic’s potential entry into the regulated U.S. market
- Pragmatic’s exit underscores the increased pressure on sweepstakes casinos
As a result, Pragmatic became the first major supplier and provider of online casino games to withdraw from the market as regulatory scrutiny intensified. While some believe that this move signals Pragmatic’s potential entry into the regulated segment of the market, other suppliers, such as Evolution, have also pulled their games from Stake.us.
This shift coincides with the proposed Assembly Bill 831 (AB831), which openly criminalizes support for sweepstakes casinos without regulatory approval or a tribal-state compact.
As a result, Pragmatic Play and Evolution aren’t likely to be the only iGaming providers to pull their support from sweepstakes casinos in the coming days.
California sweepstakes bill advances to Senate
As Pragmatic Play ceases its operations in the U.S., California’s anti-sweepstakes bill has continued to move forward, with the Senate Appropriations Committee passing AB837 on Aug. 29.
The legislation passed with a unanimous vote of 7-0 during California’s Suspense Day budget process, which means that committee members neither debate bills nor take into consideration public comments. Because of this, the bill advances to the Senate floor for its third reading.
The bill, sponsored by Assemblymember Avelino Valencia, would prohibit sweepstakes casinos that use a dual currency model from operating in the state. AB837 also introduces penalties for operators found to be running a sweepstakes casino, with fines ranging from $1,000 to $25,000.
The Senate has until Sept. 12 to pass the bill before the legislative session runs out.
VGW partners with California tribe amid sweepstakes ban
While Pragmatic Play decided to stop supplying U.S. customers with its games, sweepstakes operator VGW has instead decided to find a partner.
VGW and the Kletsel Dehe Wintun Nation of the Cortina tribe in California have announced a conditional partnership in the wake of a proposed bill to ban sweepstakes. The economic sector of the tribe, Kletsel Economic Development Authority (KEDA), will work alongside VGW to expand statewide availability of free-to-play social platforming games.
While the proposed bill, AB831, has been supported by other tribes in the state, due to views that sweepstakes casinos are ‘illegal online gaming’ and risk community funding, KEDA CEO Eric Wright has instead spoken of the potential of digital platforms for tribes and the funding opportunities that come with them.
“Large, well‐established gaming tribes already benefit from these geographic advantages and decades of success. It is self‐serving for them to advocate for policies that restrict emerging digital commerce opportunities for others, effectively holding smaller and less‐advantaged tribes hostage to their location,” said Wright in a letter to California's Senate Appropriations Committee.
