California signed AB 831 on October 11, 2025, targeting defined dual-currency online sweepstakes games before the law took effect on January 1, 2026.
California Gov. Gavin Newsom signed Assembly Bill 831 on October 11, 2025. The law added a new Penal Code provision for online sweepstakes games and took effect January 1, 2026.
Which games the law covers
Penal Code Section 337o prohibits operating, conducting or offering a covered online sweepstakes game in California. Under the chaptered text, a game must meet all four conditions in the definition: it is available online or through a connected device; uses a dual-currency system with direct or indirect consideration and prize eligibility; simulates gambling; and awards cash or cash equivalents.
The provision also prohibits listed businesses, including payment processors and gaming-content suppliers, from knowingly and willfully supporting a covered game's operation, conduct or promotion. A violation is a misdemeanor carrying a fine of $1,000 to $25,000, up to one year in county jail, or both.
For California players, the immediate consequence was that games meeting the full definition could no longer lawfully be offered in the state after the effective date.
Section 337o preserves lawful games and methods used by gambling enterprises licensed under the Gambling Control Act and California State Lottery operations. It also preserves promotions or sweepstakes run by for-profit businesses on a limited and occasional basis as advertising or marketing, when they are incidental to substantial bona fide sales of consumer products or services and are not intended to establish ongoing gambling or gaming.
A later product example appears in Modo’s California terms, which retain Gold Coin play while excluding Sweepstakes Coin games.