To learn what started betting on sports one has to first examine the history of sports gambling in the US. The USA had a long history of allowing certain types of legal gambling and also illegal betting to some extent. Political control and scandals concerning gaming interests have ended in selected backlashes which have resulted in prohibition or regulation of sports gambling. Standards and laws relating to sports gambling have kept altering.
Nelson Rose describes these changes in law as 3 waves. The first wave was during the colonial era that lasted till the mid 1800s, the second wave started following the Civil War and lasted till the early Twentieth century and also the third wave commenced while in the Great Depression and it’s still continuing.
Throughout the Colonial Era, diverse attitudes were enforced towards gambling. Puritan attitudes were adopted towards gambling and possession of dice, cards, gaming tables etc were banned. Later on it had been allowed as long as it wasn’t a calling or trade except for moderate and innocent recreation. Settlers brought with them views that said gambling was merely a harmless past time. The frontier spirit encouraged the appeal of gambling since it involved risk taking, high expectations and opportunism. arbitrage betting on horse racing
Eventually all colonies used lotteries as being a solution from financial problems as well as help the colonies. It became a civic responsibility and profits were used to establish some of the first prestigious universities, build churches and even libraries. Lotteries continued to be popular right to the early Nineteenth 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 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 became a major trade avenue for both wealthy merchants and farmers. New Orleans soon gained recognition as the gambling capital. Through 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 seemed to be increasing attack of gambling especially lotteries and when operators absconded with all the proceeds lottery scandals finally led to 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 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 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 US. With the many 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 was a popular tourist destination. Regardless of its illegality sports gambling became quite popular and already is a billion dollar industry.