Possible? YES (theorically).
Requirements:
1) A dedicated server with at least 64GB of RAM (around 300 Dollars each month) for each game
2) A very good lawyer (this is a lot illegal and there's a risk to go to jail)
3) Enough players willing to pay (in total) at least 300 Dollars each month to cover expenses
4) 72 hours (or more) in order to hack the original game and configure the dedicated server
5) A skilled coder in order to be able to provide MANUAL updates of the app
So, the real answer is YES, but nobody is gonna take so much risk for nothing
(think about CoC servers, they last no more than 1 week because they run out of money or because they're sued). Also, what's the fun in playing a private server where EVERY player has got the exactly same advantages you have using the hack?
IMHO, a server with 100 CHEATERS and a server with 100 FAIR PLAYERS is the exactly same thing. But I'd prefer the second one, since it's more likely to be: a server with 15-20 cheaters vs a server with 500,000-1,000,000 players.