To learn what started gambling on sports one has to first examine the history of sports gambling in America. The USA has a long history of permitting certain types of legal gambling and even illegal betting to some extent. Political control and scandals concerning gaming interests have ended in certain backlashes which have resulted in 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 1st wave was during the colonial era that lasted till the mid 1800s, the 2nd wave started following the Civil War and lasted till the early 20th Century and also the 3rd wave commenced during the Great Depression and is still continuing.
Throughout the Colonial Era, different attitudes were enforced towards gambling. Puritan attitudes were adopted towards gambling and possessing dice, cards, gaming tables etc were banned. Later on it was allowed as 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 nothing but a harmless past time. The frontier spirit encouraged the appeal of gambling since it involved risk taking, high expectations and opportunism.
Eventually all colonies used lotteries as a solution from financial problems as well as help the colonies. It was a civic responsibility and proceeds were used to create some of the first prestigious universities, build churches and also libraries. Lotteries continued to be popular right to the initial 19th Century. Horse racing had also been popular and the Long Island built the very 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 grand river with its riverboats became 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 held responsible 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 concluded in prohibition of gambling.
The Gold Rush in California triggered a huge surge in the types of gambling and San Francisco was crowned 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 certain professional gamblers were lynched. This prohibition drove gambling 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 USA. 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 honest. In 1978 casino gambling was legalized by New Jersey and Atlantic City became a popular tourist destination. Regardless of its illegality sports gambling became quite popular and already is a high dollar industry.