"The Gauntlet" would be a good name for it.
The scaling was an idea, But there is other ways to fix it for the smaller players to join in and not be wiped out in one hit.

A Tower would be and fighting small minions for far for each level/floor to get to a boss. And rewards could stack up to how many Floor's/Bosses defeated.

Another name for it could be Heaven's Tower" if it would to replace the palace on weekend's.

Rewards now, I say skills like adam would be over kill and if they did, fragments should be a lot harder to get then from the casino.

Other then coins and Credit's, Maybe Shard's that can be used to make chips, Since can only get those higher level ones from the casino.

Another reward that might be good, just to say is "Monster Cards" end floor bosses has a chance to drop their Card to certain players or just one. They could be used to Redeem something based off the level of that boss card or maybe like Card Game to play against other's, But of course everyone would start with a basic stack and have to make it stronger from the cards they get in drops.

Few idea's more to what has been posted so far.