Private keys are way, way more secure than passwords for that reason alone. You don't have to give anything secret to a third party.
If that's the one problem this solves and revocation and recovery and 2-factor are all still as difficult and broken as they are now with passwords that's still a huge win.
EDIT: more thoughts. I also really hope that hardware tokens like a yubikey are not required for every site or app. I'd like to be able to keep private keys on my phone or laptop for some things (how many of us keep our ssh keys exclusively on hardware tokens?).