To understand what started gambling on sports one has to first examine the history of sports gambling in the US. The US had a long history of permitting some kinds of legal gambling and also illegal gambling to a certain degree. Political control and scandals regarding gaming interests have ended in certain backlashes which have lead to prohibition or regulating sports gambling. Standards and laws pertaining to sports gambling have kept changing.
Nelson Rose describes these adjustments in law as three waves. The 1st wave was in the colonial era that lasted till the mid 1800s, the 2nd wave started at the end of the Civil War and lasted till the early Twentieth century and also the 3rd wave commenced during the Great Depression and is still continuing.
During the Colonial Era, different attitudes were enforced towards gambling. Puritan attitudes were adopted towards gambling and possession of dice, cards, gaming tables etc were outlawed. Afterwards it had been allowed as long as it wasn’t a calling or trade except for moderate and innocent recreation. Settlers brought along with them views that said gambling was merely a harmless activity. The frontier spirit encouraged the appeal of gambling since it involved high risk, high expectations and opportunism.
Eventually all colonies used lotteries as being a solution from economic problems as well as benefit the colonies. It became a civic responsibility and proceeds were utilized to establish a number of the first prestigious universities, build churches and also libraries. Lotteries continued to be popular right to the early 19th Century. Horse racing had also been popular and the Long Island built the very first race track in 1665. Casino gaming began to emerge slowly as roadhouses and taverns began to permit card games and dice.
The Lower Mississippi Valley became a structured and legitimate gambling area in 1800s. The mighty river with its riverboats was a major trade avenue for wealthy merchants and farmers. New Orleans soon gained recognition as the gambling capital. During the 1830s southern settlers turned against professional gamblers who were held responsible for carrying out crimes, debasing morals of society and endangering streets. During 1800s there was increasing attack of gambling especially lotteries and when operators absconded with the proceeds lottery scandals finally concluded in prohibition of gambling.
The Gold Rush in California set off a huge surge in the kinds of gambling and San Francisco was crowned the new gambling capital in the USA. During 1849 and 1855 gambling spread widely and by 1850 California and lots of cities had licensed gambling centers. But soon the Legislature made most types of gambling illegal and certain professional gamblers were lynched. This prohibition drove wagering activities underground and did not eliminate it. Gambling was legal during 1869-1910 in Nevada.
It is easy to now understand what started gambling on sports in the USA. With the many scandals within the lottery gambling segments, 35 states in America including California prohibited lotteries. In 1933 pari-mutuel betting was legalized and new automated systems and laws made horse racing betting more straightforward. In 1978 casino gambling was legalized by New Jersey and Atlantic City was a popular tourist destination. Despite its illegality sports gambling became very popular and already is a billion dollar industry.