Not sure why the image is broken here's a copy https://i.nostr.build/wGqOx.png
This is what nsec bunker already does.
But this would be totally trustless. No need to have a custodian hold your key or run your own bunker
From the “functional encryption” description it’s unclear what he means.
From my understanding, it's sort of like homomorphic encryption where you can create a function key based on a particular private key, which allows a certain function to operate on the encrypted data as if it was not encrypted. Thus, allowing for a note signing without revealing the nsec. https://en.wikipedia.org/wiki/Functional_encryption#:~:text=Functional%20encryption%20(FE)%20is%20a,what%20the%20ciphertext%20is%20encrypting.