Sweepstakes Casinos Face More US Shutdowns

The US sweepstakes casino sector is facing another round of closures, with Money Factory and CoinFrenzy ending operations as state scrutiny continues to pressure the business model. Their exits follow a wider wave of shutdowns across the market and highlight growing uncertainty over how players can recover balances when operators leave.

Money Factory Ends Operations With Balances Unresolved

Money Factory shut its platform with little warning on August 9. Visitors were unable to log in or redeem sweeps tokens, while a notice said the company had preserved account information and pending requests.

“All player accounts, balances, and pending redemption requests have been recorded and preserved. Players with pending requests do not need to take any action — your request and your account records are on file.”

The company did not state that refunds would be processed automatically. Its website also carried a separate notice seeking interest from parties that might acquire its assets, adding to questions about the operator’s ability to meet outstanding redemption requests.

CoinFrenzy has provided users with more time. It has stopped accepting purchases while allowing gameplay and redemptions to continue until September 25, when the platform plans to close completely.

Legal Model Faces Greater Pressure

The closures come as numerous US states have adopted laws that prohibit or restrict sweepstakes casinos. New Jersey, New York, Indiana, Maine, Oklahoma, Louisiana and Tennessee have introduced measures affecting the unregulated platforms, contributing to dozens of shutdowns over the past year.

The structure of sweepstakes casinos also creates a distinctive issue for players. Operators generally separate purchased coins from redeemable sweeps tokens, allowing the latter to be presented as having “no cash value.” Because users technically do not make conventional gambling deposits, operators are not subject to the same deposit-segregation requirements imposed on regulated gambling businesses.

That distinction could become more significant as operators disappear. A company may reserve funds for outstanding redemptions, but the model does not provide the same guarantees associated with regulated accounts.

Some Operators Shift Toward Other Products

Closures do not always mean a complete departure from gambling-related businesses. Kickr Games Play Ltd. closed its Kickr sweepstakes casino after receiving a cease-and-desist order from the Louisiana Gaming Control Board and later launched GetGud, a real-money skill-games product that does not identify itself as a sweepstakes casino.

The broader industry has also seen operators move toward prediction markets. Novig previously operated as a peer-to-peer betting exchange, entered the sweepstakes sector and later adopted a predictions-based model.

Money Factory founder Trevor Pope, along with executives Clay Johnson and Jared Pope, have also previously launched GammaSweet, a technology platform intended for sweepstakes casino operators. CoinFrenzy owner Lucky Labz LLC has not indicated a similar move.

The latest closures reinforce the pressure facing a sector that expanded while US gambling rules left room for alternative models. With more states taking direct action, operators and players now face greater uncertainty over the future of sweepstakes gaming.

Source:

“Sweepstakes Exodus Continues as Money Factory and CoinFrenzy Close Shop”, gamingamerica.com, August 11, 2026