Is this legal? I have 500 chips made, sell them for $5 each. I create a lottery where I draw a random number (between 1 – 500) for cash and prizes. It this considered a lottery.

Wouldn’t I need to comply with lottery rules in all 50 states? If I sell a chip to someone in a state that the lottery is illegal, could legal action be taken on me?

I don’t plan on doing this, I have seen other people doing this, and was just curious how they could get away with this. Thanks