To understand what started betting on sports one has to first examine the history of sports gambling in the US. The US had a long history of allowing certain types of legal gambling and even illegal betting to a certain degree. Political control and scandals regarding gaming interests have led to certain backlashes which have lead to prohibition or regulating sports gambling. Standards and laws relating to sports gambling have kept changing.
Nelson Rose describes these changes in law as 3 waves. The first wave was in the colonial era that lasted till the mid 1800s, the second wave started following the Civil War and lasted up until the early Twentieth century and the 3rd wave commenced during the Great Depression and it’s still continuing.
During the Colonial Era, diverse attitudes were enforced towards betting. Puritan attitudes were adopted towards gambling and possessing dice, cards, gaming tables etc were outlawed. Afterwards it was allowed so 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 nothing but 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 a solution from financial problems as well as benefit the colonies. It was a civic responsibility and profits were utilized to create some of the first prestigious universities, build churches and even libraries. Lotteries remained popular right to the initial Nineteenth century. Horse racing had also been preferred and the Long Island built the first race track in 1665. Casino gaming started 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 became a major trade avenue for wealthy merchants and farmers. New Orleans soon gained recognition as being the gambling capital. During the 1830s southern settlers turned against professional gamblers who had been blamed for committing crimes, debasing morals of society and endangering streets. During 1800s there seemed to be increasing attack of gambling especially lotteries and when operators absconded with all the proceeds lottery scandals eventually led to prohibition of gambling.
The Gold Rush in California triggered a huge increase in the kinds of gambling and San Francisco became the new gambling capital in the US. During 1849 and 1855 gambling spread widely and also by 1850 California and lots of cities had licensed gambling centers. But soon the Legislature made most forms of gambling illegal and certain professional gamblers were lynched. This prohibition drove wagering activities underground and could not eliminate it. Gambling was legal during 1869-1910 in Nevada.
It is easy to now understand what started gambling on sports in the US. With all the numerous scandals in the lottery gambling segments, 35 states in the US 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 became a preferred tourist destination. Regardless of its illegality sports gambling became very popular and today is a high dollar industry.