This is a great approach, if your goal is to optimize for increasing the amount of dangerous crap on the web. But, eh, that's surely worth it, because the profitability of startups is more important then little things like the security of the average netizen...
[1] Even if you make the operators liable [2], in practice, you'll never be able to collect from most of them. Whereas the blacklist curators are a singular, convenient target...
[2] If you can demonstrate how the operators of compromised websites can be held liable for all the harm they cause, I will happily agree that we should do away with blacklists. Unfortunately, the technical and legislative solutions for this are much worse than the disease you are trying to treat.
According to Google's most recent transparency report[1], as of December 20th of last year they were blocking around 27,000 malware distribution sites and a little over 2,000,000 phishing sites.
In your view, would turning off those blacklists and allowing those >2,000,000 sites to become functional again count as a "slight" increase?
(edit: That's a real question, incidentally, not a disagreement or an attempt at a 'zing'; I have no knowledge in this area but went to look up the numbers, and am curious whether 2,000,000 is truly a vanishingly small amount, relative to everything else that's out there that's not already on the list)
[1]: https://transparencyreport.google.com/safe-browsing/overview
I mean if we could trust Google (or anybody else of that kind) to have blacklist strictly limited to reasonable definition of malware and phishing, and knew that usage of such list if strictly voluntary under control of the user, it would be an acceptable, if decidedly imperfect, remedy. But we know we can't trust any of this, even if whoever works on this at Google right now are sincerely ironclad committed to never any mission creep and abuse happen, once the means exist, these people can always be replaced with others that would use it to fight "misinformation", or "incitement", or "blasphemy", or whatever it is in fashion to fight this week. There's no mechanism that ensures it won't be abused, and abuse is very easy once the system is deployed.
Moreover, we (as, people not in control of Google's decisions) have absolutely no means to prevent any abuse of this, since Google owns the whole setup and we have no voice in their decision making process. Given that, it seems to be prudent to make all effort to reject it while we still can. Otherwise next time you'd want to make a site questioning Google's decisions about the malware list, nobody would be able to read it because it'd be marked as a malware site.
There's no "report as false-positive" button at Google, so these reports likely have a lot of false positives in them...
Make it easy and affordable to submit legal complaints for tech misbehavior and make the penalties hurt.