The gold seekers who poured into Denver in 1858 soon realized that the flakes of gold they washed out of Cherry Creek came from the high mountains to the west. Most of them waited out the winter in Denver saloons, drinking Taos Lightning (a particularly spicy brand of whiskey concocted by mountain man Peg-Leg Smith and partners in 1824) and playing cards. A few were too impatient to let the snows melt in the mountain gulches, though. Among them was John Gregory, a wiry, red-haired Georgia cracker, who followed a stream out of Golden and hiked through the snow up the twisted canyon until, early in 1859, he found gold.
When news of his discovery leaked out, prospectors swarmed up the canyon, muddying the waters of the creek with their gold pans and long toms, cutting the pines to make cabins or to fuel their fires. They named the place Gregory Gulch, but it became famous as Central City, was dubbed ”the richest square mile on earth,” and for a time it was. But not for John Gregory. He made a modest sum selling his claim and apparently spent it; before he dropped out of sight. He told a Golden journalist: “I believe that I am the only living being who has not benefited by this discovery.”
A few months after Gregory’s strike there were five thousand people in Gregory Gulch, and hundreds more poured in daily. The hills were pockmarked with prospect holes and denuded of trees. There was a stench of garbage and offal and unwashed men. Meat sold for 50 cents a pound, and the few women in the camp washed shirts for $3 a dozen. When Horace Greeley arrived to inspect the diggings, he gave a speech cautioning the miners about drinking and gambling. The articles he wrote about Gregory gold served to attract even more prospectors.
Many Chinese immigrants lived in Central City during the early days working the placer deposits of Gregory Gulch. They were forbidden work in the underground mines. Most of them are believed to have returned to China after making their stake. The frontier gambler Poker Alice lived for a time in Central City and several other Colorado mining communities.
It was not civilization, however, but the American dream of instant wealth, of striking it rich, that brought thousands of gold seekers into the godforsaken gulch. Many of them did indeed strike it rich. Pat Casey, an illiterate, hard-drinking Irishman, discovered the Casey Mine and spent the proceeds on his barfly companions. Casey went through his fortune, but other gold seekers who got rich from Gregory Gulch gold were more prudent, including Nathaniel Hill, a Brown University professor who developed a method for treating gold ore, and Henry Teller, a lawyer and railroad builder. Both men were elected to the United States Senate, as was a onetime Central City resident, William A. Clark, who later made a fortune in copper in Butte, Montana.
Gold mining in the Central City district decreased rapidly between 1900 and 1920, as the veins were exhausted. Mining revived in the early 1930’s in response to the increase in the price of gold from $20 to $35 per ounce, but then virtually shut down during World War II when gold mining was declared nonessential to the war effort. The district was enlivened in the 1950’s by efforts to locate uranium deposits, but these proved unsuccessful.
The population of Central City and its sister city Black Hawk fell to a few hundred by the1950’s. Casino gambling was introduced in both towns in the early 1990’s, but had more success in Black Hawk (which has 18 casinos) than in Central City (which has 6 casinos), partly because the main road to Central City passed through Black Hawk, tempting gamblers to stop in Black Hawk instead. In an effort to compete, Central City completed a four-lane, 8.4-mile (13.5 km) parkway from Interstate 70 to Central City, without going through Black Hawk. The highway was completed in 2004, but Black Hawk, which prior to the introduction of gambling was much smaller than Central City, continues to generate more than seven times the gambling revenue that Central City does. To compete, Central City has recently eliminated height restrictions for building on undeveloped land. Buildings were previously limited to heights of 53 feet (16 m), so as not to overshadow the town’s historic buildings.