Standard Disclaimer: I'm a fluff guy, not a mechanics guy. So take my mechanics stuff at the bottom with a grain of salt.

The Name: While I'm all for taking the metaphor and translating it into the real in Exalted, I would at least like to see the barest minimum effort in renaming it to disassociate it from our world. Even an amalgam would do (Camoc's Razor? Camoc's...Temporal Blade? Why not?).

The Materials: Correct me if I'm wrong, but dematerializing items is mostly an effect of outside influences onto the item in question. Otherwise, some Twilight would've invented phasing weapons/ammunition at some point during the Primordial War.

Because of the nature of the item in question, I do find Starmetal appropriate, but I see no need for it to dematerialize if we acknowledge that Starmetal can more easily cut threads of fate* than other metals. Give it knife stats if you have to, I'd say. You're not getting any MM bonus because of alloy construction, so you might as well throw some Blue Jade in there too. I'd see that more than Soulsteel.

*What you could say happens, fluff wise, is that the Razor cuts through the skin of a problem...go back to the metaphor of truth being an onion. Maybe more of a potato in this case, but, eh, truth ain't always pretty.

Mechanics: Because of the above, and because of how Occam's Razor works IRL, I'd say it should simply subtract a cumulative 1 to an Intelligence roll's external difficulty for each roll made in a prolonged test; starting with -1, minimum difficulty 1, so "Instant" checks at least still get -1. Before you say, "Wait, that's so underpowered," remember, this is a modification of the external difficulty, not an amplification of the character's abilities, meaning it doesn't stack with normal equiment/Charm bonuses. With enough time and Second (Ability) Excellency, a character could roll-less succeed virtually any Intelligence roll out there. ...So maybe that's a bit OP. I dunno. I iz bad with teh mekanikz.