California sweepstakes cafes reimagined as alt-currency pachinko parlors

California’s internet sweepstakes cafés are proving harder to kill than Freddy Kruger and/or Dan Bilzerian’s (alleged) sexually transmitted diseases.

Last year, the California legislature passed a law explicitly banning so-called sweepstakes cafés – essentially internet cafés in which users pay for time on computers offering games that mimic slot machines – which have proliferated in strip malls across the US. The American Gaming Association estimates that these cafés take in around $10b annually.

Sweepstakes owners challenged California’s law, claiming the outcomes of their games were predetermined and thus they were no different from lottery scratch tickets. In June, the California Supreme Court disagreed, ruling that since a sweepstakes user “causes the machine to operate, and then plays a game to learn the outcome, which is governed by chance, the user is playing a slot machine.”

Despite this ruling, California café owners aren’t going quietly. This week, Bakersfield’s CBS affiliate KBAK reported on one café operator that had reinvented itself as a ‘social gaming’ facility using its own proprietary ‘alt coin’ currency.