Just make it easy for everyone to create their own mailing list. Then you could subscribe to friends, and get updates from them, plus participate in discussions with their other friends. "Muting" a friend would be up to the controls in your desired email client. "Unfriending" is simply unsubscribing.

I've been dreaming about this a lot lately, but there's definitely some roadblocks for the average person. They don't want to clutter up their existing email, and they will drag their feet to getting a new email address just for social networking. People also like the idea that they can actually delete their posts, even if it's illusory, which they can't do to any meaningful extent with email. With ActivityPub, I think a lot of potential developers don't want to bother with email because it's not the future. It is still a great idea in general, though. I would totally build it or sign up for it if enough people I knew were willing to do it. The problem is I wouldn't want that form of social networking just to connect with people who are smart enough to use it.

True, but at the same time deleting a post only matters because new people can see it that may not have initially. With this, only people who the message was sent to would see it anyway.

If as part of the on boarding process you could provide instructions to move those messages out of the main view and into a folder so they didn't clutter up the rest of the email too.

It probably makes more sense as an open source project. There's not much of a profit model for decentralized social networking where you can't inject ads that people didn't want to see.