Guess we're about to find out. The current government (albeit with a different (arguably more liberal) PM) has already revealed it has a desire to criminalise any crypto it can't decrypt. Because paedos and terrorists. That kind of legislation seems a natural outgrowth of this, once they find a 'think of the children' case to use as leverage. That's why we worry about the 'thin end of the wedge'.

If this was currently being developed in the UK, my money would be on illegal.

Thankfully it's a well-known concept now, and a foreign-invented technology you need to interoperate with the rest of the world.

Nothing stops them from throwing the law at you though, even if they know if won't work. You literally can't be punished as a prosecutor for anything less than deliberately throwing the trial for money. If they feel they won't win they'll intentionally ruin your life anyways.

If you can prove (on the balance of probabilities) that you don't have the key - because it doesn't exist or otherwise - then you are not guilty of the offence. Of course, that's not entirely straightforward.