Leetcode style interviews probably serve two functions: 1) A way to suppress wages and job mobility for SWE. Who wants to switch jobs when it means studying for a month or two? Also, if you get unlucky and some try hard drops an atomic LC hard bomb on you now you have an entire company you can no longer apply to for a year. 2) A way to mask bias in the process while claiming that it’s a fair process because everyone…
It's also a great way to filter out anyone who has any kind of commitment like kids, aging parents to take care of, or have health issues themselves that makes it hard to cram leet code non stop on top of a busy career. For companies this is very rational, you want non-distracted employees who can work over time.
In all my years of sw dev the number of times that would have helped vs being able to communicate and manage expectations across a swath of people is like 1:1000.