Did you already try to create a key with a fresh ~/.gnupg, eg. move ~/.gnupg to ~/.gnupg.bak and try again? If that works, you can narrow it down to the config.
After entering the password, gpg generates the random bytes and prints to use the system to gain entropy, so it’s likely that part that is failing. Does it immidiately fail with a timeout or does it take some time to _actually_ time out? -- tippfehlr
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