It's interesting and you should keep iterating. My critiques: it requires a scroll container with sufficient margin to move the top and bottom elements (or I guess left and right) past center; the "place" button is quite unintuitive and should be placed nearer to the pick-n-place container, or even on the selected element itself; and the position of the selected element isn't quite right, though this seems more like a bug.

Keep iterating! Drag-n-drop is good on desktop, but I disprefer it for mobile.