This is one of those plot threads that I'm glad TNA dropped.
It sounds like a good idea; it's pretty much ripped straight from the older days of professional boxing, but whoever thought it up forgot that professional fighting and professional wrestling are two different animals. One is about competition, the other is about a drama the audience consents to believe is a competition. The championship rankings reduced the writers options; instead of being able to build up a feud through three pay-per-views, culminating in the Big Match at the Big Pay Per View, they were forced to place a new contender after the old one was beaten, unless they went with some kind of Dusty finish (which they didn't, to their credit.)
If you can't build up a feud, you can't build up drama. Outside of the championship scene, it just existed as a vehicle for Kurt Angle to work with, and go over, every single promising young talent in the company. It probably sounded cool in the writer's room; a plotline you can set up multiple offshoots from, but there aren't many places you can go with it, and you exhaust those quick.