Washington, D.C. lawmakers are weighing a proposal that would authorize online casino gaming in the district while creating a direct ban on sweepstakes-style platforms that use dual-currency systems. Councilmember Wendell Felder introduced Council Bill 260656, titled the Internet Gaming and Consumer Protection Act, with the measure now referred to the Committee on Human Services for review.

The legislation would establish a regulated online casino market under the supervision of the District’s Office of Lottery and Gaming. It would also give regulators enforcement powers against operators offering products outside the proposed legal structure.

In a letter to the council, Felder said, “This bill reflects a practical, data-informed approach to strengthening consumer protections, modernizing our gaming framework, and capturing revenue that is currently flowing outside of the district’s oversight.”

Proposed Market Structure for DC iGaming

If approved, licensed operators could offer games including blackjack, poker, roulette and slot titles to customers aged 21 or older who are physically located in the District. The Office of Lottery and Gaming would oversee standards tied to identity checks, geolocation controls and cybersecurity measures.

The proposal does not set a cap on the number of operator or supplier licenses that may be issued. Companies seeking an operator license would need to pay a $2 million application fee. Licenses would run for five years, with renewals priced at $500,000 for the same term.

The bill (pdf) would apply a 25% tax on adjusted gaming revenue. It also permits negative gaming revenue to be carried forward from one month to the next.

Felder said district residents wagered an estimated $700 million with offshore and unregulated gaming platforms during 2024. He added, “These figures make clear that iGaming is not a new activity—it is already occurring. The policy question is whether the district will regulate it effectively or allow it to remain unregulated.”

The legislation also includes a local spending requirement. Operators would need to direct at least 35% of their local budgets to District-based businesses or risk penalties.

Under the measure, the first $500,000 in tax revenue from online casino operations would go to the Department of Behavioral Health for gambling addiction prevention, treatment, referral and recovery programs.

After that threshold, remaining revenue would be distributed across several public agencies. The Department of Insurance, Securities and Banking, the Office of Victim Services and Justice Grants, and the Department of Employment Services would each receive 30% allocations under the outlined structure. The Department of Health would receive 10%.

Additional levies would support a Community Reinvestment Fund focused on financial counselling, victim services, public health research and workforce programs.

As reported by SBC Americas, Felder said, “Initial annual tax revenue could reach tens of millions of dollars, with growth expected as the market matures. These funds could support critical priorities, including behavioral health services, responsible gaming programs, and broader community investments.”

Sweepstakes Platforms Face Direct Ban

The proposal separately targets sweepstakes casino models. It defines a dual-currency gaming product as a “game, promotional scheme, or platform that uses 2 or more forms of currency, credits, tokens, entries, points, or similar units, whether purchased or awarded, where one or more such units may be redeemed, converted, transferred, or used directly or indirectly for cash, cash equivalents, prizes, or prize equivalents”.

Regulators would be able to issue cease-and-desist orders to unlicensed businesses operating such products in the District. Civil penalties could reach $100,000 per violation, while repeated breaches could bring fines of $500,000. The District’s Attorney General would also be empowered to pursue restitution and disgorgement actions.

If enacted, Washington, D.C. would join other U.S. jurisdictions that have moved against sweepstakes casinos in 2026, while similar proposals remain active elsewhere.

Even if the council passes the bill, the measure would still face congressional review under the Home Rule Act before taking effect. The proposal specifies a 60-day review period. If no congressional action blocks it, regulators would then have 90 days to prepare rules, with a target launch within 180 days depending on readiness.

The move follows the District’s shift to an open online sports betting market in 2024. That change ended FanDuel’s exclusive position after it replaced GambetDC, the earlier platform powered by Intralot. Washington, D.C. now has six online sports betting operators.

Felder said, “Inaction carries real consequences. Without a legal framework, revenue continues to flow to unregulated operators, consumers remain exposed to risk, and the district falls behind neighboring jurisdictions that are moving forward”.