To understand what started betting on sports one has to first examine the historical past of sports gambling in the US. The US had a long history of permitting some kinds of legal gambling and also illegal betting to a certain degree. Political control and scandals regarding 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 altering.
Nelson Rose describes these changes in law as three waves. The first wave was during the colonial era that lasted till the mid 1800s, the second 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.
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 was not a calling or trade except for moderate and innocent recreation. Settlers brought with them views that said gambling was nothing but a harmless past time. The frontier spirit encouraged the appeal of gambling as it involved high risk, high expectations and opportunism.
Eventually all colonies used lotteries as being a solution from economic 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 remained popular right to the initial Nineteenth 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 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 both wealthy merchants and farmers. New Orleans quickly gained recognition as the gambling capital. Through the 1830s southern settlers turned against professional gamblers who were 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 set off a tremendous surge in the types of gambling and San Francisco was crowned the new gambling capital in the USA. During 1849 and 1855 gambling spread widely and 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 easy to now understand what started gambling on sports in the US. With the many scandals within 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 high dollar industry.