To understand what started betting on sports one has to first examine the historical past of sports gambling in the US. The USA has a long history of allowing certain types of legal gambling and also illegal betting to a certain degree. Political control and scandals regarding gaming interests have ended in selected backlashes which have lead to prohibition or regulation of sports gambling. Standards and laws relating to sports gambling have kept altering.
Nelson Rose explains these changes in law as three waves. The first wave was in the colonial era that lasted up until the mid 1800s, the second wave started following the Civil War and lasted up until the early Twentieth century and also the third wave commenced while in the Great Depression and it’s still continuing.
During the Colonial Era, different attitudes were enforced towards betting. Puritan attitudes were adopted towards gambling and possession of dice, cards, gaming tables etc were outlawed. Afterwards it was allowed so long as it was not a calling or trade but for moderate and innocent recreation. Settlers brought along with them views that said gambling was nothing but a harmless activity. The frontier spirit encouraged the appeal of gambling as it involved high risk, high expectations and opportunism.
Ultimately all colonies used lotteries as a solution from financial problems and to benefit the colonies. It became a civic responsibility and profits were utilized to create 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 was also popular and the Long Island built the very first race track in 1665. Casino gaming started to emerge slowly as roadhouses and taverns started to allow card games and dice.
The Lower Mississippi Valley became an organized and legitimate gambling area in 1800s. The grand river with its riverboats was a major trade avenue for both wealthy merchants and farmers. New Orleans soon gained recognition as being the gambling capital. Through the 1830s southern settlers turned against professional gamblers who had been blamed for carrying out crimes, debasing morals of society and endangering streets. During 1800s there was increasing attack of gambling especially lotteries and whenever operators absconded with the proceeds lottery scandals finally concluded in prohibition of gambling.
The Gold Rush in California triggered a tremendous 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 also by 1850 California and many 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 possible to now understand what started gambling on sports in the US. With the many scandals in 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. Regardless of its illegality sports gambling became quite popular and today is a billion dollar industry.