From Ancient Lotteries to Dildos on the Court
How gambling went from state-sponsored dreams to prediction markets with outcomes on everything
We’re all born with chips on the table.
You gamble your safety, your sanity, and your ability to produce capital every single time you walk out your front door.
It is a simple fact of our biology that we try to hedge against with insurance policies, HOA guidelines, and seatbelt laws, but the math remains the same.
Life is risk management. Our existence is defined by a chaotic vortex of probability, where all of us are trying to find an edge and keep the sevens rolling.
Yet, we love to label gambling a vice.
Historically it’s been relegated to the smoky, neon-lit corners of society, so the rest of us can go on pretending it’s an aberration rather than a fundamental human instinct that we can’t resist.
Gambling is in our DNA.
Ever notice how every state fair and sporting event sells tickets for a 50/50 draw? Suddenly the dynamic changes, because it’s labeled as charity, allowing patrons to pretend they are doing it for the kids instead of the rush of winning a pile of cash.
We cloak our dopamine addiction in altruism because admitting we just want to get lucky feels just a little too dirty for polite company. It is a societal cope that we all engage with and perpetuate.
But that’s nothing new. We have been hacking this glitch in the human operating system for millennia.
The Great Wall of China? Rumors say it was funded by Keno slips, essentially lottery tickets where players could wager on numbers. The Han Dynasty knew they couldn’t tax the peasants into oblivion to fund a defense against the Mongols, so they sold them a game instead.
Rome did the same. Augustus Caesar repaired the crumbling streets of the Empire, known for extensive renovation of the city without increasing taxes. Caesar raised funds, and his popularity, as the lottery was voluntary and offered a win condition. It was perceived, largely, as a form of entertainment with the potential for good fortune, rather than a tax.
The real turning point came as states realized they could weaponize hope, in 1530 Florence, with the introduction of La Lotto de Firenze, known today simply as Lotto. It was the first of its kind, with regular weekly drawings.
And it was a cash printer, demonstrating that if you put a price on a dream, the math doesn’t matter to the average person.
But then French government learned a hard lesson in 1729, thanks to Voltaire.
Long before he was a philosopher king, he was a degenerate who realized the government officials in France weren’t so great at calculating expected value. Along with mathematician Charles Marie de la Condamine, he realized they were selling lottery tickets attached to bonds at a price so low that the payout was mathematically guaranteed.
Together they formed a syndicate, bought every ticket, and broke the bank. It was the original DAO hack. Voltaire was set for life at age 35, the first time that mathematical autists beat the house in such magnificently public fashion.
Over the next few decades the House would evolve and soon realize that marketing is at the root of it all.
Enter Casanova in 1757, the legendary seducer whose name we’d later turn into shorthand for a smooth-talking womanizer.
Dead broke and fresh out of a Venetian prison, Casanova convinced the French King that a lottery should look more like a party than a tax. He dazzled ticket buyers with showmanship, velvet, and prestige. He proved that if you wrap the risk with enough swagger and style, people will thank you for taking their money.
He was the original vibe check.
It wasn’t until 1964 when the first modern, government-run U.S. lottery was established in New Hampshire, intended to raise revenue for education without an additional tax. Like lottos past, it was hugely successful, generating $5.7 million in the first year. And that’s in 1964 dollars!
It paved the way for other states like New York and New Jersey to establish their own state-run lotteries, breaking open the floodgates for the rest of the country interested in capturing more revenue without the political fallout of raising taxes.
Like all human systems, the lottery continued to expand, with advertising pushing more people to do their civic duty by supporting the voluntary tax system.
Somewhere along the line the game shifted. It stopped being a hack for specific public goods and morphed into a more general tax, levied disproportionately on the mathematically illiterate; the all-too-often poor midcurvers who cannot distinguish the difference between a 0.01% chance and a 0.0000001% chance are the ones feeding the machine most.
It remains an effectively veiled tax on hope. And business is booming.
If you really want to see how the game is changing, all you need to do is walk into the heart of America’s gambling epicenters: Las Vegas and Atlantic City. Both of them surprised me, though in different ways.
Atlantic City has been on the decline for a while. It has never been the same since it was ravaged by Superstorm Sandy in 2012, which ripped apart the boardwalk and caused massive damage to a city already in financial decline. What used to be the lone territory to access slots and table games around New York, Pennsylvania, Delaware, and New Jersey was now suffering from the isolationism that used to be its biggest benefit.
Casinos were granted legal status and built across all over those four states in the last decade, negating the manufactured, monopolistic advantage that drove commerce to Atlantic City for so many years.
We stayed our first night in Harrah’s, one of the casinos off of the boardwalk, isolated in an unwalkable no-man’s land that effectively keeps you in the casino without seeing the light of day. Harrah’s was never fancy or best in class, but it was always more affordable, forced to compete on pricing to make up for the location.
Driving in we saw a dilapidated old sign that said $20 parking for the main garage, that was simply a relic of times past, when their parking lot would actually hit capacity. We parked for two days then drove out without paying a dime.
And although it feels dated compared to the newer casinos, it still has a niche with reasonable pricing as far as casinos go, and the same old operation I remember from my college years.
Cocktails were $18 instead of $28.
We ventured to the boardwalk and experienced Ocean as the new overpriced gaudy experience that lived up to the billing.
At 4am in Harrah’s, drinking my fifth watered-down whiskey, I watched a grandmother in a NASCAR shirt feed her Social Security check into a slot machine. As her oxygen tank beeped with a rhythmic warning, I realized Atlantic City wasn’t dying. It had already died and we were all just enjoying fucking the corpse.
“What is dead may never die, but rises again harder and stronger.”
- Game of Thrones
It became clear to me that Atlantic City will continue to find a way, surviving on Jersey Shore culture and local degenerates that will never leave the East Coast.
I’m not so sure Vegas has that luxury. It appears to be accelerating into a soulless hellscape of extractive games and overpriced experiences, on the fast track to becoming accessible only for whales and delusional losers.
We took our first big gamble out of the gate by opting to stay at Treasure Island, hoping to find some of the old-school kitsch that made Vegas so iconic.
“Where’s all of the pirates?” my fiancé asked as she looked around the tired lobby, expecting a costumed actor to greet us and swing from the rafters.
“Avast ye!” she yelled at the lady behind the desk, hoping to trigger a fun response as she imagined a Disney style resort, only to be disappointed that the pirate vibe had been reduced to lowbrow nautical decor in effort to rebrand as just “TI” instead of Treasure Island.
Our travel companions all stayed off of the main strip, opting for the newer Resorts World that opened in 2021. It has a new, upscale feeling, enhanced by the Tesla Tunnels that allow drivers to take riders on an underground adventure for only $5 each, and completely avoid the usual Vegas traffic.
It’s flashy and “nice” but the games are nothing short of donation plates for confused tourists that haven’t kept up with the latest bastardizations to classic games. This new Vegas isn’t for the guy trying to turn $100 into $500.
It’s for the guy dropping $50k on a weekend who doesn’t look at the bill.
As Trung Phan highlights, the casinos are quietly rewriting the rules in plain sight and tipping the scale way more in their favor.
I couldn’t imagine sitting down at a roulette table with a triple zero and putting money on the table.
The real rot is in these new game mechanics. Even the once sacred craps tables, notorious for having some of the most favorable odds for players, are being ruined with digitized versions where you don’t even touch the dice. It’s expensive and slow to operate the old school craps tables, compared to the machines that require no operator and give the house full control over how the dice roll. Better for the house, but worse the player in almost every regard.
Similarly, this “Lucky Cat” blackjack is a new twist that increases the house edge by giving the dealer an option if they bust with exactly 22. This happens to be the most common number they bust on, triggering a new sequence where the dealer shakes out four dice, each with just one cat on a single side. If you roll fewer than three cats, it’s a push instead of your win. Land three cats, though, and your bet gets a bonus multiplier.
The real hook is that if you get all four cats, where your bet multiplies big time.
The expected value of this situation greatly favors the house and preys on a classic fallacy. It’s a “Near-Miss” trap where the visual of two or three cats makes you feel like you’re so fucking close to a win. Rolling just one more cat feels easy, but in reality that fourth die makes the outcome exponentially harder to hit.
The probability is multiplicative rather than additive. Every die you add creates a vertical wall of difficulty that the 100:1 payout doesn’t even come close to covering.
Forget about complimentary drinks, a relic from the days when they wanted to get you drunk to keep you gambling; now they rely on the dying breed of aged alcoholics willing to pay an additional tax by giving in to impatience and ordering drinks from the bar.
Strategic tourists are increasingly privy to the scam, opting for minimal lodging like The Linq for a third of the price of a traditional casino that just happens to be right next door.
The beginning of the end for Vegas was not the Canadian-driven tourism drop, but the prevalence of digital casinos now accessible from any modern smart phone. A loophole in the laws about sweepstakes allow digital casinos to deploy official apps with classic casino games as long as there’s a path for free players to “win” something through a sweepstake. As long as that base piece is in place, the layers on top can very much mimic the same casino apps that are considered illegal.
The practical difference comes down to players using a soft currency, like gems or diamonds, that are purchasable with regular currency. Often to cash out, players can use their “points” to buy giftcards from the shop, which are as good as cash.
For many gambling addicts this is the game changer. No longer are they required to physically engage by going to a casino. There was a point where Vegas and Atlantic City did have something novel to offer; there weren’t any digital rails that offered 24/7 access to games of chance.
You had to enter the meatspace to get that chance. And risk your own safety in the process.
Society can only swim upstream for so long before legislation starts to catch up, and in this case that means legalization. State by state we legalized sports betting, unleashing a torrent of advertising in the process rivaled only by the American pharmaceutical industry.
“Ask your doctor if this drug is right for you!” has to be one of the loaded sentences in the English language, second only to “This four-way parlay that includes Saquon Barkley to score the first touchdown is pretty good value.”
We’ve put strong limits on Big Tobacco because we know the marketing is all too effective, especially on the youth. Yet for some reason we let sports books turn every NFL broadcast into a QVC segment for bad-value prop bets and high risk parlays.
And now we have the Trump administration teasing the removal of income tax on gambling winnings, in a cunning populist swing for approval ratings at the expense of incentives that are entirely backwards.
I would enjoy the luxury of not paying taxes on my winnings as much as the next guy, but do we really want a society where the highest perceived value is in wagering on sports and political events? Is that the optimal path for the future of our economy?
One step closer towards Idiocracy; an eerie Back to the Future Part II reality where less smart money is on innovation, and more of it is on the sports almanac. Simultaneously subsidizing the world that is 97% losers, further accelerating the top 1% that back these ventures, and indirectly inhibiting mobility through a system endorsing -EV distractions over building.
Now we’re seeing the final boss emerge: Prediction Markets.
Platforms like Polymarket and Kalshi are winning the regulatory arbitrage game, utilizing the grey market to offer lines beyond sports into anything with a verifiable outcome.
Society starts to bend when everyone has the opportunity to bet on everything. The meaning of betting starts to dissolve when anything can be made a market.
We got a glimpse at the tip of the iceberg during the last season of the WNBA, when “fans” started throwing different colored dildos onto the court to resolve specific prop bets. It started as a joke, a simple meme when a sexist tossed the first dildo for nothing more than the love of the dildo game.
Then it evolved into free money for opportunistic risk-takers.
The wildest part is that the dialogue and rhetoric was less about scouring for alpha around the color of the next dildo, but more so the technique to toss from under the seat with extreme wobble to obfuscate its origin.
The alpha was how to rig the market. That’s the headspace of this generation: who can create the best psy-op to manipulate the market over who has the best analysis.
Even worse is the shift in mentality that comes with these new betting apps labeled as prediction markets. Players are no longer gamblers; instead they’re heralded as traders in the latest mindfuck from the digital elite.
They hand us a slick UI that makes market orders feel like just another sports bet, and we take the bait. Hook, line, and sinker.
The meta today is to make you think that you are the casino.
You’re not a gambler, you’re a strategic liquidity provider!
And that’s the mentality that keeps the 97% putting up their exit liquidity for the real insiders that build these systems.
The old casinos just wanted you to play.
Scariest yet, is that now there are more incentives than ever for players to cook small bets. Never before has the instant liquidity on outcomes to fail been so accessible, loaded and waiting for any anonymous account to take advantage of the quick settlements.
Athletes have always been able to fix specific outcomes and lay down lines against their own performance, but the depth and prolific nature of these new markets presents a cat and mouse game for law enforcement comparably impossible to the war on drugs.
Bettors are becoming increasingly vocal about “strange coaching decisions” and seeming “random” errors piling up to drive narratives and trigger statistical thresholds.
Sports get strange when the payout for the failure of a play pays more than executing it.
I have no doubt we will see scandals in the next decade that are shockingly stupid, obvious, and low-brow. Best friends placing bets. Insiders texting on monitored lines, huge line movements just before key moments. We ain’t seen nothin’ yet.
And although prediction markets are inherently more transparent and do provide us with valuable data on world events, they present a societal conundrum that we seem ill-equipped to tackle. It should be better than the old ways of regulatory darkness and loan sharking bookies.
But somehow it’s not.
Perhaps this is the dark side of permissionless protocols that enable our worst temptations.
I want the freedom to access these platforms, like the proper Polymarket instead of the neutered app version for USA users, but we also have to contend with the fact that there incentives might be perverse.
Although if AI is about to displace millions of jobs in a system without any form of UBI, gambling is a great way for those in power to buy time for whatever comes next.
I’m just worried it will resemble something from the Hunger Games as said by President Snow:
“Hope.
It is the only thing stronger than fear. A little hope is effective. A lot of hope is dangerous.
A spark is fine, as long as it’s contained.”
In today’s world, the ultimate form of hope isn’t progress.
It’s a parlay.
This article comes at the perfect time! I was just thinking about how even trying a new Pilate move feels like a small gamble. You really make a convincing case that risk is everywhere.