I don't think they meant literally Oauth but instead that you can get a verification request from the party that needs your age verified, get it signed by the government, and then send the assertion back to the relying party. It's not necessary for the government to send the signed verification request directly to Pornhub. It's not even necessary for the government to sign the assertion itself. A trusted device (like most consumer phones) could store the identity locally after government verification and then sign assertions itself after biometric or PIN verification, which is what most proposals look like.