Yeah, I don't think this will work on commercial scale exactly for the same reasons as blockchain is useless for anything outside the illegal niches where you need to avoid the legal banking system.

You may let people store homomorphic data on your servers and even run your algorithms on that data, but you have no way of handling customer complaints or fine-tuning / debugging your service because you can not understand ANY of the customer data you are storing.

Similarly, blockchain sounds like a good idea until you need to reverse a transaction: https://www.pcmag.com/news/cryptocom-sues-woman-after-accide...