I really would like to use it, but without ability to backup it, I don't wanna. I've read some time ago Yubikey of some other company showed initial spec, but I never heard any followup, I don't remember the link. For now I'm using TOTP but it's a chore. Salesforce Authenticator has nice idea with custom push-based protocol, but it's not running on dedicated hardware. I think ESP32 S3 has hardware potential to act as security has as it has e-fuses and has enough umph for cryptography, it would be interesting option to see (maybe with optional wifi/bluetooth faraday cage on it)
Here [1] is Yubico's draft WebAuthn recovery ("backup authenticator") extension spec, which is possibly what you're thinking of.