Mainly because it give this illusion that once you've "leveled up" in something, you'll stay at that level forever - like in video games. But the truth is that all skills need to be honed and maintained, or else they will falter. Anyone that's been active in sports, music, art, etc. know that maintenance is the key, and that even then, you will not stay at the same level forever.
Gamification can be good for people that need structure, clear goals, and measurable progression. But it can also lead to sacrificing understanding for the sake of speed and execution - if that makes any sense? And also false expectations of what it takes to become the very best at something.
The leetcode/technical interview "grinding" culture is full of this.