For sure this is happening on 3rd world country prison. Here in PH even on prison they have a drug den and private house with complete amenities for drug lord that still can operate their drug business even inside the prison.
I have heard that some men in prison have very flourishing businesses which they control from within the walls of the prison and those are the prison OGs and are not kept at the same cells with others, so I believe anything is possible and for the drugs cases, this is a very critical one because it harms the society. The government has a role to play to address this, that is if they are not being settled by the drug lords.
Maybe in prison they are not betting with money rather some task and chores that assigned to them since they don’t care about money when you’re in jail.
Gambling exists everywhere, both among kids, youths and even the old. I'm not surprised it exists too in the prison since most of these convicted guys are still gamblers and they would literally find means to satisfy their gambling desires. Most prisoners gamble with actual money because I've been to orison and actually given a friend money, so most of them have funds at their disposal and would gamble among themselves with it, especially over card and dice games.