Virtual Gaming Worlds (VGW) will no longer offer its sweepstakes casino games in New Jersey as a sweeping regulatory ban looms.
The company’s popular brands, including Chumba Casino, Luckyland Slots, and Global Poker, will no longer be available to its customers in the area.
Key takeaways
- New Jersey is expected to ban sweepstakes casinos before the end of Aug. 14.
- VGW will continue offering Gold Coins in a single-currency system.
- The Garden State was active in reshaping its gaming industry recently.
The New Jersey legislature approved Assembly Bill A5447, a bill to ban sweepstakes casinos, on June 30. Gov. Phil Murphy hasn't signed it into law, although it will be enacted on Aug. 14 if it doesn't receive action before then.
VGW is one of several sweepstakes operators that braced for the ban by shutting down their operations.
“We understand this news may be disappointing, and want to assure you that this decision wasn’t made lightly — it was carefully considered based on several business factors,” the company said in an announcement. “While Promotional Play will no longer be available, you’ll still be able to enjoy all your favorite games in Standard Play using Gold Coins.”
The switch from promotional to standard play with Gold Coins means customers will no longer be able to use Sweep Coins, which contribute to sweepstakes casinos operating on a dual-currency system.
This dual-currency mechanism means users can but don't need to use real money to play games, thereby allowing the platforms to circumvent state licensing and regulation.
VGW won't disseminate Sweeps Coins after Tuesday, July 29, and they can't be used beyond Aug. 26. Sweeps Coins also can't be used to redeem prizes after Sept. 24.
Staying out of trouble
VGW showed a tendency to leave state markets when regulatory scrutiny is apparent.
The company exited New York’s sweepstakes casino market shortly before the state assembly passed a bill to ban such platforms. It also backed out of Mississippi’s market after it received a cease-and-desist order from the state regulator last month.
VGW is also not alone in leaving New Jersey. More than a dozen platforms, including several popular operators, shut down their operations while bracing for the legislative ban.
The developments are significant, since the Garden State has been friendly to the gambling industry and is one of only seven states with legal online casinos. However, the state also took a firm stance when deemed necessary, such as its stand-off with prediction platform Kalshi over sports event contracts' legality.
