Sweepstakes Casinos in Hawaii

Stakester’s Take

Hawaii's sweepstakes casino market thrives despite the state's restrictive gambling environment. These legal sweepstakes casinos deliver strong game selections, robust purchase options, and rewarding bonuses. Here are the top picks for 2025, each with standout features and unique reasons to play:

Hawaii’s Sweepstakes Casino Laws: Legal Status Explained

Hawaii’s relationship with gambling is defined by a long history of prohibition and strict enforcement. The state has consistently maintained some of the toughest anti-gambling laws in the United States, dating back to the early 19th century.

Today, Hawaii remains one of only two U.S. states with a blanket ban on all forms of commercial gambling:

1. No casinos
2. No lottery
3. No pari-mutuel betting
4. And no tribal gaming

This prohibition extends to both land-based and online gambling, including online poker and sportsbooks. Even social sports betting is strictly limited to platforms that use virtual currencies and sweepstakes mechanics, such as Onyx Odds, rather than real money wagering.

Sweepstakes Casinos: Why They’re Legal

Sweepstakes casinos operate legally in Hawaii because they do not require players to risk real money for a chance to win. Instead, these platforms use virtual currencies (such as Gold Coins or Sweeps Coins) and always provide a free entry method, ensuring compliance with state law.

Players use these virtual currencies to play games and, if successful, redeem winnings for prizes or cash equivalents, not direct cash bets. This model carefully avoids the “consideration” element that would otherwise make them illegal gambling or lottery operations.

Hawaii’s Gambling Regulator

Currently, Hawaii has no dedicated gambling regulator, as all forms of gambling are prohibited under state law. Should SB 1507 or pending sports betting legislation pass, the Hawaii Lottery and Gaming Corporation would be created, with a seven-member board appointed by state officials. Once all board members are in place, they will have 180 days to set up the regulatory framework and select an operator to run the gaming platform.

The HLGC will oversee sweepstakes casinos, online lottery, and other permitted gaming activities, setting standards for compliance, player protections, and community benefits. If approved, this would mark a historic shift in Hawaii’s approach to gaming regulation and oversight.

Responsible Gambling

While Hawaii does not require sweepstakes casinos to provide responsible gambling tools, players can access addiction counseling and support through organizations like Birches Health.

Tools such as Gamban can help block access to gambling sites. There is no official state self-exclusion register, but most reputable sweepstakes casinos offer self-exclusion and account limits voluntarily.

Hawaii’s Sweepstakes Casino Tax Requirements

• All sweepstakes winnings (cash or non-cash prizes) are taxable as income at both the federal and state levels.
• Hawaii’s top state income tax rate is 11%, among the highest in the U.S.
• Operators may issue a Form 1099-MISC or W-2G for winnings over $600.
• Winners are responsible for reporting all prizes and paying both federal and state taxes.

Latest Hawaii Regulatory Changes Affecting Sweepstakes Gaming

Hawaii’s sweepstakes and online gaming landscape is evolving rapidly in 2025, and soon, the state may face new changes in its gambling terrain, potentially making the market more competitive and dynamic.

• SB 1507: This bill proposes creating the Hawaii Lottery and Gaming Corporation (HLGC) to regulate sweepstakes, lottery, and online casino gaming. The HLGC would be tasked with launching Hawaii’s first state-backed sweepstakes casino, offering both local and nationwide games with Hawaii-themed prizes. If passed, the HLGC could begin operations as early as July 2025, with a 180-day window for implementation after board appointments.
• Sports Betting: Despite significant legislative activity, sports betting remains illegal in Hawaii. Recently, a bill to legalize sports betting passed both the House and Senate but ultimately stalled in the conference committee due to disagreements over regulatory oversight and tax rates. Lawmakers and industry advocates continue to push for legalization, and new proposals are expected in 2026.
• Casino Growth: More than 100 sweepstakes casinos are now accessible to Hawaii players, with frequent new launches and increasingly innovative bonuses. This surge is partly in anticipation of possible regulatory changes that could further expand the market.
• Community Funding: Proposed legislation would direct a portion of gaming revenue to support local community projects and tourism initiatives, aiming to ensure that any gambling expansion benefits the broader public.

While real-money gambling remains prohibited, Hawaii is on the cusp of significant change. The state’s lawmakers are actively considering frameworks that could transform Hawaii into a more competitive and regulated gaming market soon.