Stake Faces New York Lawsuit Alleging Minor Recruited to Gambling

A lawsuit filed last week in the New York Supreme Court accuses sweepstakes casino Stake.com of recruiting a minor into illegal, offshore crypto gambling via influencer-driven marketing campaigns.

The lawsuit was filed by Seeger Weiss LLP and Rafferty Domnick Cunningham & Yaffa on behalf of a minor identified only as John Doe. The plaintiff’s lawyers are calling the case an attempt at addressing “systemic failures that allowed illegal gambling access and financial facilitation to reach a minor.”

Stake.com operates as a sweepstakes casino, a format that allows users to potentially win money or prizes through a dual-currency system without spending cash. These casinos have been under fire from state regulators across the country, who allege that the sites attempt to circumvent gambling laws while still offering casino gaming. Operators of the site contend that their format – which allows users to potentially win money or prizes without spending any money – means they are subject to sweepstakes laws, not gambling regulations.

Lawsuit: Minor Able to Circumvent Age Restrictions Despite ‘Red Flags’

According to the lawsuit, the plaintiff was able to open a Coinbase account at just 13 years old and then repeatedly make cryptocurrency purchases to fund online gambling accounts, despite what lawyers call “multiple red flags.” Those included Coinbase's age requirement of 18 or older, an identity mismatch on the account, and a linked payment method labeled “High School Checking” on Coinbase. 

Because of these issues, Coinbase is listed as a co-defendant alongside Stake.com in the case.

“This is not a story about a kid who found a loophole,” Frederick Schenk, managing partner of The Schenk Law Firm, said in a statement. “It’s a story about an industry that built the loophole, marketed it to children, and collected fees on every transaction. We intend to hold every link in that chain accountable.”

The lawsuit also alleges that Stake uses strategies to evade US regulations and attract young users. Those include the use of VPNs, the establishment of mirror sites, and a covert Discord network that distributes pre-verified accounts to users to bypass identity and age verification protocols.

“Stake.com operates illegally in every state in the United States. And yet over five million Americans visit the platform every month,” lawyer Benjamin Schenk said in a statement. “These entities operate without a moral anchor, run by people who see themselves as above borders, ethics and the law. It’s time they answer to the American public.”

Stake, Drake Facing Multiple Lawsuits

According to a statement from the plaintiff's lawyers, the minor withdrew from college “within a week” of his exposure to Stake. He has since been diagnosed with compulsive gambling disorder and panic disorder, and attends Gamblers Anonymous meetings four times a week.

The lawsuit also notes that Stake has used celebrity influencers to recruit players via livestreaming platforms such as Twitch and Kick. It prominently notes rapper Drake as one of these influencers.

This isn’t the first time Stake and Drake have faced legal action related to the online gambling site. In October 2025, a Missouri man filed a class-action lawsuit accusing Stake.us, Drake, and stramer Adin Ross of using misleading advertising to make users believe they were playing at a harmless social casino.

(Photo:  Robert W / Alamy)