To understand what started gambling on sports one has to first examine the history of sports gambling in America. The US had a long history of permitting certain types of legal gambling and even illegal betting to a certain degree. Political control and scandals concerning gaming interests have ended in certain backlashes which have resulted in prohibition or regulation of sports gambling. Standards and laws pertaining to sports gambling have kept altering.
Nelson Rose explains these changes in law as three waves. The 1st wave was in the colonial era that lasted up until the mid 1800s, the 2nd wave started at the end of the Civil War and lasted till the early 20th Century and also the 3rd wave commenced while in the Great Depression and is still continuing.
During the Colonial Era, diverse attitudes were enforced towards betting. Puritan attitudes were adopted towards gambling and possession of dice, cards, gaming tables etc were banned. Later on it had been allowed so long as it wasn’t a calling or trade but 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 risk taking, high expectations and opportunism.
Eventually all colonies used lotteries as being a solution out of financial problems and to benefit the colonies. It was a civic responsibility and profits were used to establish a number of the first prestigious universities, build churches and also libraries. Lotteries remained popular right to the early 19th Century. Horse racing had also been preferred and the Long Island built the very first race track in 1665. Casino gaming began to emerge slowly as roadhouses and taverns started to allow 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. Through 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 whenever operators absconded with the proceeds lottery scandals eventually led to prohibition of gambling.
The Gold Rush in California triggered a tremendous 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 many cities had licensed gambling centers. But soon the Legislature made most types of gambling illegal and a number of 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 possible to now understand what started gambling on sports in the USA. With all the numerous 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 preferred tourist destination. Despite its illegality sports gambling became quite popular and already is a billion dollar industry.