For anyone curious, you can unsheathe this sword, you just need to find another altar like this one. I found the stone-sheathed sword in some random catacombs, don’t remember if it was on an altar or not, and when I brought it here I instead got the option to unsheathe it, getting the sword of darkness. From what I understand, there’s three altars, one has the sword, and the other two are used to unsheathe it, turning it into the sword of light or darkness, depending on which of the other two altars are used. Correction: You can actually change between the sword of light and the sword of darkness, just go to the altar of whichever sword you want, and you can swap out for the sword you want.