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@monoidal observes in #11715 (comment 375240) that

{-# LANGUAGE TypeFamilies, PolyKinds, ConstraintKinds #-}
import GHC.Types
type family Id (a :: k -> Constraint) :: l -> Constraint
type instance Id f = f

type T :: Constraint -> Constraint
type T = Id Eq

data Proxy p = MkProxy

id' :: f a -> f a
id' x = x

z = id' (MkProxy @T)

causes

<no location info>: error:
    panic! (the 'impossible' happened)
  GHC version 9.3.20210824:
	ASSERT failed!
  Ill-kinded update to meta tyvar
    a_aIJ[tau:1] :: Constraint -> Constraint
                    Constraint -> Constraint := Eq :: * -> Constraint
  Call stack:
      CallStack (from HasCallStack):
        massertPpr, called at compiler/GHC/Tc/Utils/TcMType.hs:1009:10 in ghc:GHC.Tc.Utils.TcMType

when assertions are enabled (e.g. a DEBUG compiler).

Constraint-vs-Type is a difficult problem (see #11715), but I think we can pull this off and fix it. I imagine we just need to change an eqType to tcEqType somewhere.