1) I post a receipt of the item, have a video drawing of the sweepstake, and post the tracking number of the package after it's sent out. Short of revealing the winners name, I don't know what other proof I can provide (although googling the user's usernames reveals quite a bit about them, I encourage them to change their usernames). I understand what you mean, on first glance I can see how people think the site is a scam.

2) I show how many people enter, so the odds are 1/(total number of entries). I was thinking of requiring a valid/unique phone number on registration and require the users to input the code I text them. Think of Craigslist / Chatroulette / etc.

I don't envision any people from Hacker News using the site on a daily basis. In fact, I posted it here as a "Show HN" and a whooping <10 people visited. There are people where an extra $25 means getting to take your daughter out to dinner when she announces she's engaged or an extra $100 means you get to pay your bills on time for the month (real winner stories so far). What really pushes me to work on the site every day is that even if the site fails to grow, at the end of the day, I've helped people without asking for anything in return.

I appreciate the comments.

So are you paying for these prizes out of pocket? What's your goal?

Yeah, the prizes are paid for out of pocket by me. It's not the most expensive project in the world, let's say I average $50/day ($1,500/month) in gift card costs and $10/month on a server. I live in a 42 square foot room and share an apartment with 5 people, so I'd say that the expenses are taken care of from my choice of a frugal lifestyle (we're talking Manhattan, New York rent here). Those are my only expenses to run and maintain the site. The risk of $1,500/month for a couple of months to possibly achieve my dream is a no-brainer.

My goal is growth. Craigslist is a great example of a site that I want to be like. Offer an awesome service for free. I'd like to have companies fund the giveaways or maybe even have companies pay to have their giveaways featured as a top result. I don't really know yet. I'm sure there's some win-win situation that I haven't thought of where the users get awesome free stuff and there's a way for me to work on the website full time.

Thanks for the responses. Have you considered reaching out to businesses to offer free stuff? Sort of like Groupon that doesn't cost them anything other than the discount/free item they provide?

Yeah I've definitely considered it. It's on my list of things to do, but I'm also sort of experimenting with the website and trying to optimize the user experience and make the site fun.