Nope, everything is as expected. This config cannot work 
For the sake of learning you can read the other similar topic starting at post 10
The easiest would be to return to udev until you learn how to make a proper systemd config (i have linked the wiki).
So replace
HOOKS=(base systemd autodetect microcode modconf kms keyboard sd-vconsole block filesystems fsck)
With
HOOKS=(base udev autodetect microcode modconf kms keyboard keymap consolefont block encrypt filesystems fsck)
And then (from the live usb chroot do you know how to?)
mkinitcpio -P
update-grub
reboot