Thank you for your elaboration! You have obviously given this a lot of thought.
There’s a lot of interesting concepts in the mechanisms you lay out. But the proof it in the pudding. It should be really important that your prototype clearly and intuitively demonstrate how all this works, and removes any doubt. My feedback relates to what most people will think or say when first coming upon your project/product website.
You mentioned a “business model”, so maybe you intend to create a startup around this. I would strongly encourage you to create a separate documentation website where you outline in detail exactly how things work, with diagrams and specifications and the like. And I would give the content an open license, maybe CC-BY-SA or even CC0. You can then create a community around this and crowdsource refinement of the concepts, remove loopholes, and - importantly - get tons of feedback and then user testing on your prototype. If you want this to get broader tech adoption I think opening up like this is vital.
An example, on a different area of tech, is how @AndrewMackie documented his Offerbots (to bypass aggregators of attention), and especially the Problem analysis is splendid (I don’t know if Andrew is still working on the solution side, though).
Regarding identity, like i said, there are a variety of open standards in the works. I am curious about your thoughts in this direction. For a working software based on current standards (PGP) the FOSS project Keyoxide is very interesting (very similar to Keybase, but better).