With the rise in number of new security engineers all competing for few "security research" jobs (security research/hacking is the "I want to be a game developer" of security), you start getting into these convoluted hiring processes. Unlike standard software engineering, there aren't even remotely enough positions to accommodate everyone, so the bar can get absurdly high.

Honestly, if the team is asking CTF questions, they clearly want hires with previous CTF experience and should just do targeted hiring from the top teams at different conferences.

At least send people a free t-shirt if they complete the challenge.