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The only thing I dislike about this idea is that it appears to be another centralised service.

Why can't we come up with something similar but using HTTPS and Public Key Infrastructure that I can host on my own server but still be interoperable?

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I don't think you fully read how it works. It said the storage providers etc can be self hosted.

I might have misinterpreted the overview, but the key server/service that provides authentication for users sounded like a central point in the system.

They mention in the docs that there's no reason to keep it only key.upspin.io, and that they expect it'l be replicated and hosted elsewhere.

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