As states move to ban sweepstakes casinos, a new class of gaming platforms has emerged built on advance deposit wagering, the licensed framework that governs online horse racing.
Six states enacted explicit bans in 2025, including California and New York, which together account for a significant share of sweepstakes revenue nationally. Louisiana, where regulators sent cease and desist letters to operators in late 2025, passed HB 53 on April 1, a measure that would classify sweepstakes operations as racketeering activity. More states are expected to follow.
The dual-currency sweepstakes model generated $3.4 billion in net revenue in 2024, according to Eilers and Krejcik Gaming. By late 2025, the firm had revised its 2026 projection to $3.6 billion, a 10 percent decline, citing bans in California and New York, operator exits, and a shrinking addressable market. Some operators have responded by pivoting to platforms built on horse racing law, a regulatory framework that predates the sweepstakes model
Horse Racing Backs a New Style of Game
Advance deposit wagering, commonly referred to as ADW, is a form of licensed wagering traditionally used for online horse racing. Oregon is one of only two states that issues multi-jurisdictional ADW hub licenses, and a license from the Oregon Racing Commission allows an operator to accept wagers in any state where ADW is legally permitted.
Parimutuel powered games are built on that infrastructure. Rather than using a random number generator to determine outcomes, these platforms tie game results to live pari-mutuel horse racing pools. The game types, slots, bingo, crash games, and table-style options, look familiar. The underlying mechanics do not.
When a player purchases credits, those credits trigger a wager placed into a live racing pool. The game reveals the result once the race settles. Players are not competing against the house. They are competing within a shared pool, with payouts distributed among winning tickets after the operator takes a percentage commission.
The model operates under horse racing regulation rather than the promotional rules that govern sweepstakes sites, which legally require a no-purchase entry option. ADW platforms carry no such requirement, because players are legally placing wagers on racing rather than entering a sweepstakes.
Several platforms operating under this model have obtained licenses through the Oregon Racing Commission, launching in states including Alabama, California, Florida, Louisiana, and Michigan, as noted by sweepstakes site Sweepsy.com.
Other Models Are Emerging Too
ADW is not the only alternative gaining ground. In Florida, Hard Rock Bet launched slot-style games tied to the results of past motor races rather than horse races, positioning the product under the state’s sports betting compact with the Seminole Tribe rather than parimutuel law. Unlike ADW platforms, the model is player versus house rather than pool-based.
Historical horse racing, a format in which slot-like terminals generate outcomes from archived race results rather than live pools, has long existed in a retail setting. Oregon has authorized one online version, the only known example of the model operating outside a physical location.
Regulation Is Reshaping the Terms
Beyond outright bans, regulatory pressure is also changing how platforms present themselves. Some sites have shifted minimum age requirements from 18 to 21 ahead of anticipated legislative changes, with updated terms reflected at signup.
Parimutuel powered game platforms operate under distinct terms from sweepstakes sites given their pari-mutuel classification. Operators are required to disclose the horse racing element of their product and provide players with detailed information about how wagers are placed and settled.
With traditional sweepstakes legislation advancing in states including Indiana, Maine, Maryland, and Tennessee, the window for unregulated dual-currency gaming continues to narrow.
