The clearest end point for this is some government issued digital ID that just asserts who you are, acts as a login etc.
You can see this as a stepping stone to there. if you squint.
Is it the idealism of the 70s coke to life? No. Is it some sane compromise - I think so.
What if we cannot trust our government ? Sorry it is pretty sure that no internet is going to solve that. That's on the real world.
You wrote "I kind of get both sides here", but, to be clear, this is the polar opposite of both the WEI proposal and Apple's thing, both of which go to some lengths to not allow identification of actual humans (they focus on proving that the device is legit).
The next step is barely a step.
If you require some kind of authentication process to prove your identity, it doesn't matter whether your device has TPM-supported device attestation or not. If Apple or Google wanted to do that, they already have the in-browser infrastructure for it in the form of login with Apple or login with Google. Making such a thing anonymous for third parties (so they just know it's a human, rather than which human) would be trivial.