New York Online Casinos

Recent legislative proposals and discussions regarding the legalization of New York online casinos indicate that approval may happen sooner rather than later.

Simply put, the New York online gambling market is too lucrative to ignore, given the state’s large population and robust economy.

The rise of sweepstakes casinos as an alternative may also prompt lawmakers to act. Residents can legally use sweepstakes casinos to play casino-style games like slots and blackjack, yet the state earns little to no tax revenue from this activity.

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Additionally, the successful launch and strong performance of New York’s legal online sports betting market have demonstrated the significant tax revenue potential of online casinos.

New York Sweepstakes Casinos

Some operators have developed sweepstakes-based models to offer casino-style games with cash prizes to circumvent anti-online gambling statutes in New York.

Legal sweepstakes casinos employ a dual-currency system, typically involving Gold Coins (which can be purchased but have no cash value) and Sweepstakes Coins (which cannot be purchased but are redeemable for cash prizes).

The “no purchase necessary” option enables New York sweepstakes casinos to operate as promotional contests rather than online gambling.

Recommended Sweepstakes Casinos in New York

New York Law on Sweepstakes Casinos

Sweepstakes casinos operate legally in New York by complying with all relevant federal and state laws.

New York’s General Business Law regulates sweepstakes promotions—and, by extension, social casinos. To qualify as a sweepstakes promotion rather than online gambling, a platform must meet three key criteria:

  1. Promote a consumer product or service
  2. Determine winners by chance
  3. Offer a way for individuals to participate without making a purchase

Maximum Prize: $5,000

Players should be aware that New York sweepstakes casinos cannot pay prizes greater than $5,000 due to state law.

Under NY Gen Bus L § 369-E, sweepstakes promotions with prizes greater than $5,000 must register with the New York Department of State at least 30 days before the promotion begins.

However, the randomized nature of sweepstakes casino games—where players can win a jackpot at any time—makes it impossible for these casinos to comply with the registration requirement.

As a result, sweepstakes casinos in New York limit the maximum possible winnings per game or spin to $5,000.

For example, Chumba Casino’s terms and conditions specify:

In New York and Florida, the maximum redemption value for a Prize won on any one spin or play is USD $5,000 and any Prize with a value in excess of USD $5,000 will be reduced to a maximum value of USD $5,000.

Legal Threats Facing Sweepstakes Casinos in New York

Although sweepstakes casinos currently operate in New York without issue, they are facing increasing legal scrutiny nationwide.

New York lawmakers have become increasingly focused on addressing sweepstakes casinos, with some lawmakers calling for outright bans, and the legislature considering legislation to prohibit sweepstakes platforms.

In early 2025, State Senator Joseph Addabbo, chair of the NYS Senate Racing, Gaming, and Wagering Committee, announced his intention to address sweepstakes casinos in New York.

In a podcast interview, Senator Addabbo argued that inaction could lead to greater issues:

“One of my primary objectives as Gaming chair is ensuring New Yorkers are protected from gambling operations that have the potential of becoming more problematic without proper legislative action, such as unregulated sweepstakes casino operators.”

He further emphasized:

“Many sweepstakes’ operators are located offshore making enforcement limited or impossible, and our most vulnerable populations, youth and elderly, are most often targeted, which is why I want to act to address this existing loophole.”

Later, Sen. Addabbo explained that his goal is to either prohibit sweepstakes casinos outright or integrate them into a broader regulatory framework:

“To close this loophole, I will work to ban or incorporate Sweepstakes Casinos in the state, akin to current laws in Michigan, Idaho, and Washington, and I will push for iGaming as a safe, effective alternative for online casino enthusiasts.

The most immediate threat to NY sweepstakes casinos may be law enforcement action.

In an early 2025 NYS Gaming Commission meeting, the state’s highest-ranking gambling regulators singled out sweepstakes casinos as targets for law enforcement efforts.

The Gaming Commission Chairman stated that “staff have made several referrals to law enforcement and is assisting in case development.”

Recently, the New York legislature considered SB 5935, a bill that would formally define “online sweepstakes games” and prohibit sweepstakes casinos.

The bill is stalled in committee at the moment, but it’s still alive and remains a viable threat to the future of sweepstakes casinos in New York.

Will New York Legalize Online Casinos?

The odds favor New York legalizing online gambling, but significant hurdles remain.

Passing a bill to regulate New York online casinos is complex, as proponents must:

  • Rally sufficient support to pass the law
  • Draft and refine a bill each legislative session
  • Negotiate competing interests

Factors Favoring Legalization

could generate substantial tax revenue.

The New Jersey online gambling industry generates over $350 million in annual tax revenue with an adult population of just 7-8 million and a 15% tax rate.

New York, with an adult population of 15 million and proposed tax rates exceeding 30%, could easily surpass $600 million in annual tax revenue. Some estimates are even higher (more on that later).

The New York online sports betting market has been highly successful, generating:

  • $22.6 billion in total wagers (2024)
  • Over $2 billion in operator revenue
  • Over $1 billion in state tax revenue

Given that online casinos typically generate more revenue than sports betting, legalization could significantly boost state income.

Additionally, New York’s success in effectively regulating sports betting, implementing geolocation technology, and preventing minors from participating makes online casino gambling more palpable to the public and regulators.

Although New York has yet to pass an online gambling bill into law, lawmakers continue to introduce legislation annually.

The persistence of these efforts suggests that proponents believe they have momentum. Moreover, the longer this trend continues, the more likely it becomes that a bill will eventually gain the support needed to become law.

There’s mounting evidence that large numbers of New Yorkers already gamble online through numerous channels:

The widespread availability of online gambling alternatives in New York strengthens the argument for legalization. Proponents argue that since online gambling is already occurring, the state should:

  • Implement the will of its citizens
  • Regulate the industry to protect minors and problem gamblers
  • Tax it to generate much-needed revenue

Some of the nation’s most prominent online gambling and sports betting brands, including sportsbook operators licensed in New York, are aggressively lobbying for legalizing online casinos.

The Bet On NY campaign, which is backed by the Sports Betting Alliance (whose members include DraftKings, FanDuel, BetMGM, and Fanatics) has been active in New York since January 2024.

These operators possess considerable lobbying experience and substantial financial resources, both of which they are leveraging to push for legalization.

Challenges to New York’s Legalization Efforts

Some lawmakers and a significant portion of voters oppose online casinos due to concerns over potential social consequences.

Critics argue that granting every resident access to a “casino in the palm of every resident’s hand” could exacerbate gambling addiction and contribute to issues such as:

These concerns are not unfounded, as data from New York’s legal sports betting market has already raised alarms regarding problem gambling.

Any bill seeking to legalize online casinos must include a robust responsible gambling framework to gain broader political support.

Land-based casino operators continue to raise concerns about the potential impact of online gambling on their businesses.

While some studies indicate that online gambling and brick-and-mortar casinos can have a synergistic relationship, others suggest that smaller, land-based operators may suffer revenue losses.

Even major casino operators have expressed concerns.

In a late 2024 earnings call, Las Vegas Sands CEO Robert Goldstein voiced hesitation about proceeding with a proposed $6 billion casino and resort on Long Island:

“I need some understanding of how the market thinks about online gambling. If any market does legalize it, you have to think ‘what does it mean to me and my capital investment?’ It makes you stop and scratch your head. You can’t ignore that possibility when you see the impact of online in New Jersey, Pennsylvania, Michigan on land-based revenue…”

“I’d love to be in New York with the right capital structure and the right licensure process but that’s the wrinkle… My personal thinking has been influenced somewhat over the last six months as I see the growth of online gambling. It’s something to think about as we move forward.”

Concerns over cannibalization have also surfaced in the New York State Legislature.

Assemblywoman Carrie Woerner, chair of the Assembly Racing and Wagering Committee, has discussed cannibalization as a potential issue impacting the revenue of New York’s upstate casinos.

In a February 2025 interview, she was asked about the odds of New York legalizing online casinos. Her response was noncommittal but leaned against the state legalizing online gambling in the near-term:

“I think in the Assembly we’ll be taking a look at it, but I would not think that we’re ready to take that step yet. There’s a lot to look at. I know it’s out there and under consideration and I’ll certainly take a hard look at it. We’ll see.”

Labor unions—particularly the New York Hotel and Gaming Trades Council (HTC)—have consistently opposed online casino proposals, arguing that legalization would threaten brick-and-mortar jobs.

While previous bills included union-related amendments, they have failed to fully address these concerns.

In early 2024, nearly 700 employees of Resorts World Casino signed a letter to State Senator Joe Addabbo, opposing his efforts to legalize online casinos:

“We find it appalling that you are pushing legislation that would hurt workers like us and our industry in order to benefit a handful of companies who are seeking massive profits at our expense.”

Bhav Tibrewal, political director of the New York Hotel and Gaming Trades Council, reinforced this stance:

“This iGaming proposal undercuts the best thing about casino gaming in New York: permanent, high-quality jobs that New Yorkers can live and retire on. We’ve stated and re-stated our opposition to iGaming to Senator Addabbo and now it’s time for him and other legislators to start hearing it directly from casino workers.”

Senator Joe Addabbo, in a February 2025 interview, acknowledged that labor union resistance remains a major roadblock:

“We do have a major obstacle in the Hotel Trades Council. My constituents are members. I do nothing but want to grow their membership. But they believe that iGaming would cannibalize brick-and-mortar retail. Right now, the governor will say we don’t do iGaming because the union doesn’t want to. I am hopeful instead of losing revenue to New Jersey, Pennsylvania and Connecticut and the illegal market and not being able to fully help a person with an addiction, hopefully the governor will call union and legislators to the table and let’s figure this out.

“We have an opportunity to be a model for every other state for iGaming. We have to be creative in legislative language, but it has to be an initiative. It’s a partnership. I look to the governor for leadership because right now the union won’t talk with me.”

The New York State Legislature operates within a limited timeframe, and online casino legislation must compete with numerous other policy priorities.

The absence of online gambling provisions in recent New York State budgets suggests that it is not a top legislative priority.

New York needs revenue, but online gambling is just one of the many avenues lawmakers are exploring to address the problem.

Recent polling indicates moderate public support for online casino legalization.

In mid-2024, Senator Joe Addabbo released poll results showing that only 44% of his constituents in Senate District 15 supported legalizing online casinos, while:

  • 33% opposed legalization
  • 23% were undecided

Without overwhelming voter support, legalization advocates face an uphill battle in persuading uncommitted lawmakers.

New York Online Gambling Market Potential

Legal online casinos and poker sites predate the expansion of sports betting in the US by some five years.

However, the legalization of online poker and online casino games has taken a backseat to sports betting since the Supreme Court opened the door for states in May 2018.

Although sports betting has proven to be an easier sell, online gambling is where the real revenue opportunities reside.

That said, the two verticals also complement each other, and lawmakers looking to maximize revenue potential should view them as two sides of the same coin.

New York already has the online sports betting part down pat, and the revenue from legalization has been substantial.

Experience in other states demonstrates that legal online gambling revenues are additive, meaning they’ll only boost New York’s broader iGaming market once it spans sports betting and casino games.

New York Online Casino Revenue Estimates

Recent results from the New York sports betting market indicate that online gambling could generate multiple billions in operator revenue, and $1 billion plus in tax revenue for the state.

In 2024, the New York online sports betting industry hit several milestones:

  • $22.6 billion in total wagering handle
  • Over $2 billion in operator revenue
  • Over $1 billion in tax revenue to the state

Considering that online gambling revenues significantly exceed sports betting revenues in states that regulate both activities, New York casino apps could generate even more impressive revenue numbers.

Here’s how gross gaming revenue compares in three other states that have legalized online casinos and sportsbooks (with NY included for comparison’s sake):

StateSports Betting Gross Receipts (2024)Online Casino Gross Receipts (2024)
New Jersey$1.1 billion
(source)		$2.4 billion
Pennsylvania$510.7 million
(source)		$2.2 billion
Michigan$460.5 million
(source)		$2.4 billion
New York$2 billion
(source)		N/A

A 2024 Spectrum Gaming market research report concluded that legal online gambling in New York could generate:

  • $2.5 billion in operator revenue in its first full year
  • $4.5 billion in operator revenue by Year 5

Multiple bills under consideration in New York have proposed tax rates for online gambling of around 30% to 31.5% on gross gaming revenue (GGR). This proposed rate is higher than New Jersey’s approximately 15% tax but substantially lower than Pennsylvania’s effective tax rates on certain gaming verticals—where online slot revenue is taxed at 54% and table games/poker at 16%

If New York legalizes online casinos with a tax rate of 30-31.5%, the tax revenue potential based on the above figures could look something like this:

  • $750-$790 million in tax revenue its first full year
  • $1.35-$1.42 billion in tax revenue by Year 5

That’s roughly in line with estimates from online gambling advocacy group Bet On NY.

Significant Revenue Potential from Licensing Fees

In addition to tax revenue, New York could generate substantial upfront revenue from licensing fees if it imposes high licensing fees on operators.

For example, Pennsylvania managed to extract exorbitant licensing fees for online casinos, poker sites, and sports betting apps:

  • $4 million for an online poker license
  • $4 million for an online slot license
  • $4 million for an online table game license
  • $10 million for an online sports betting license

Licensing fees for Michigan gambling sites and New Jersey are measured in six-figure numbers. If we amortize Pennsylvania’s $20 million licensing fees for offering a comprehensive suite of online gambling over five years, the already high tax rates are pushed even higher.

If New York adopts a similar licensing structure, the state could collect hundreds of millions in additional revenue before casinos even begin operating.

What Tax Burden Will NY Online Casino Operators Accept?

One of the most debated elements of gambling expansion is the licensing fee and tax rate. What percentage of revenue will the state receive?

Operators and industry folks are keen on lower tax rates and licensing fees and tend to get their way. That is thanks to a nonstop torrent of doomsday scenarios about an uncompetitive market if the burdens are too high, and in some cases, implying that a particular threshold will cause them to reconsider applying for a license.

Based on experiences in Pennsylvania (online gambling), New York (online sports betting), and other high heavy burden jurisdictions, that doesn’t seem to be an argument that holds much water.

New York Online Gambling FAQ

No. New York has not yet legalized online casinos, but there are multiple indicators that lawmakers will pass a law to regulate online gambling within the next 2-3 years.

Sweepstakes casinos operate in a legal grey area. Regulators are aware that New Yorkers play casino-style games via sweepstakes casinos, but they have so far declined to intervene.

However, recent comments from the NYS Gaming Commission and Sen. Joe Addabbo indicate a crackdown or regulation is imminent. In that case, players will have to wait for the first NY online casinos to launch to play slots for real money and blackjack online.

Most sweepstakes casinos that accept New Yorkers require players to be 18 or older, but some operators have adopted 21+ policies.

Most commercial and tribal casinos in New York require players to be 21 and older. However, some tribal casinos accept customers 18 and older.

In all likelihood, the New York State Gaming Commission (NYSGC) will regulate all forms of real-money online gambling in New York.