You can already play with this using Git's "grafts" and "replace refs" features. Most of Git's graph algorithms are OK with this because they traverse the graph

You can already play with this using Git's "grafts" and "replace refs" features. Most of Git's graph algorithms are OK with this because they traverse the graph while setting one or more "SEEN" bits on each node. If you find one that loops infinitely, it would be worth making a bug report.