There were fintechs that did this, I think yotta and one other that was acquired by a big bank. I think it was (is?) popular but if I remember correctly they lost customer funds because of Synapses failure and the way the customer funds were organized they weren’t insured.

That would be interesting. Probably works best as a non-profit with donations or grants. Be a normal gambling setup, but with the expected value of all the games zero instead of negative. Advertise to existing gambling addicts. You might also be able to invert some of the dark patterns to encourage less addictive behaviour.

I expect the main threat would be that it might be possible to extract money with the system with clever statistical tricks.