i had think of it in a simpliest way, stil i like your idea.
my idea was like:
it might work as a weekly system, i mean, every player could have the right to 3 league challenges daily (maybe more or less, 3 seems ok imo), up to the player if he fights or not; the poits would be awarded according to wins or loses and at the end of the week the players with most points move to the next rank and the players with less points move down, and some stay in their current rank, that way the points would reset weekly, and perhaps you could set a certain number of players per rank, say:
rank A : 8 players
rank b : 16 players
and so on...
my 2 cents.