For years, the state of Nevada has basically cornered the market on legal sports gambling in America. To legally make a bet on a sporting event, you still have to physically enter one of the many licensed sports book establishments in the state, (it's also legal in very limited ways and areas in Oregon, Delaware and Montana). The bad news is the in-state requirement has discouraged millions of bettors from doing their business in Nevada. The big question has always been: how can Nevada get that money into the state legally? And there's also been a smaller question asking how the best sports books can expand their businesses beyond the state.

Two bills just passed and signed into law in Carson City have finally provided the answer in a very Wall Street-style way. Senate Bill 443 allows out-of-state businesses and investment groups to put their money in funds managed by or on behalf of sports handicappers who legally make bets in person in Nevada. According to the bill, the business entity must be registered with the Nevada Secretary of State and keep an account with a Nevada bank.

To put it more simply, now investors have the power to put their money into a fund that invests in the betting prowess of the best handicappers in Vegas. This could bring in billions of dollars into Nevada that has been kept out of the state and pushed into the hands of illegal sports betting operations for years. And better than that, it could attract major hedge fund money into the arena.

But there's more. The second bill signed into law allows Nevada's sports books to branch out across the world. So in other words, you could soon be able to walk up to a branch office in Cleveland and place a wager on a baseball game that would officially be placed by someone else in Nevada. This second bill will require more co-operation from those other localities. But if other states like New Jersey are successful in getting sports gambling legalized, the second law will allow the established sports books to capture a lot of that new business. Think of it like the way Merrill Lynch set up thousands of storefront brokerage offices across the country and started an investing revolution.

CNBC and Power Lunch will follow this story as it develops.