It was recently announced that the federal government is planning to discontinue production of the penny, because over time the cost to produce a penny has far exceeded the value of one. In turn, inflation has slowly whittled away at the value of a penny, so it costs more and is worth less. But with penny slots ubiquitous on a casino floor, will there be any changes for gamblers?
What do you think will happen to slot machines with one-cent and two-cent denominations when the US Mint phases out pennies in 2026?
Cindy
We don’t expect any changes here Cindy, and our answer comes from a few directions.
First of all, slot machine denominations often differ from the currency available. We distinctly remember seeing ½ cent slot machines on casino floors, even though you couldn’t be paid a half penny. 2-cent and 20-cent denomination options are frequently found on machines today, and a $25 denomination slot isn’t unusual in high limit.
Second, even though penny production will cease, pennies will still be legal tender and there are an estimated 114 billion pennies in circulation – we don’t expect the penny to fully disappear anytime soon.
There’s also hints of what will happen at casinos in the aftermath of the pandemic. A coin shortage led many casinos to stop giving out coins at machines (a practice some continue to maintain because it also proved to be a cost saver). Before machines were able to print tickets, some casinos were simply rounding numbers up to the next dollar.
With the penny the rounding would be even smaller, going up to the next nickel, and, when combined with the fact that many players don’t bother to cash in their under $1 tickets at the cashier, we expect casinos to take that approach as it won’t really cost them all that much anyway, should they run out of pennies, or simply decide to stop carrying them at scale, as many casinos have with dimes and $10 bills.
So no, we don’t expect penny slots to go away, but the payout process will likely evolve as penny availability decreases.
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