Evolution and Pragmatic Play Pull Content from Stake.us amid California Lawsuit

Two prominent content providers in the iGaming industry, Pragmatic Play and Evolution, have removed their offerings from the sweepstakes platform Stake.us for customers in California. This move further underlines the intensifying pressure on sweepstakes casinos operating in the United States as more jurisdictions take measures to curtail this form of wagering.

Suppliers Likely Seek to Minimize Potential Harm

This decision closely follows a civil enforcement action initiated by the City of Los Angeles against Stake.us and several of its partners. The complaint alleges that the company, which presents itself as “America’s Social Casino,” is engaging in unlicensed gambling in violation of California law despite its insistence that its products align with existing legal frameworks.

The lawsuit also names several of Stake.us’ suppliers, including Evolution and its affiliated studios, including NetEnt, Red Tiger, Nolimit City, and Big Time Gaming. According to a recent Next.io report, titles developed by these studios are no longer available on the platform. Hacksaw Gaming, another supplier involved in the proceedings, appears to have also pulled its titles.

The decision by suppliers to cut their ties with Stake likely stems from pragmatic reasons. Such companies heavily depend on maintaining positive relationships with state regulators, and their ties with sweepstakes platforms represent a reputational danger. A disgruntled regulator could easily scrutinize their right to operate within licensed jurisdictions, significantly hindering their operations in the gambling space.

Sweepstakes Are Becoming Increasingly Contentious

Stake.us is the American sweepstakes branch of Stake.com, a globally recognized crypto gambling website known for its sports and entertainment sponsorships. Proponents argue that, unlike online casinos, Stake’s format, where users receive virtual coins and redeem rewards using sweepstakes mechanics, makes the company exempt from traditional gambling laws. Nevertheless, regulatory bodies are increasingly viewing these services as little more than casino gaming under a different label.

Los Angeles officials assert that Stake.us has deceived Californians by portraying itself as a benign social product while subjecting players to the dangers of unregulated gambling. Stake.us has pushed back against the accusations, vowing to defend itself against all claims. However, the loss of its suppliers could constitute a significant blow to its operations.

These developments align with California’s Assembly Bill 831, which attempts to ban sweepstakes casinos entirely and is now on its way to the Senate floor. However, the bill faces significant opposition. Several tribal groups have united against the bill, arguing it could hurt legitimate promotional gaming. The Social and Promotional Games Association has echoed those concerns, arguing that AB 831 would devastate California’s digital economy.