A good deal of what you’re saying sounds like normal teen issues. You are struggling to find out who you are and how to relate to others. Sometimes memories and daydreams are happier than the present, so you go there in your mind. That’s normal, too. In addition, you are by nature introverted and kind of shy, so you are perhaps struggling more than some of your classmates who are more naturally social. The most positive thing you said is that you do have a couple of good friends and you do value their friendship. That means you do know how to connect with others. That’s something to build on.
I’m worried that you are measuring yourself against some ideal that is difficult, if not impossible, to reach. I assure you, many, many teens (and quite a few adults for that matter) have more trouble than you might imagine figuring out how to be social, how to say the “right” things and how to have the perfect retort. Although they probably serve as distractions, hurting yourself and doing destructive things is not going to make things better and will only further damage your self-esteem. Instead you need to be building on the friendships you have.
Often it is friends who help friends figure things out. If you and your friends have a trusting relationship, you may be able to talk together about how to be more at ease with other people. If your friends aren’t the type of people to do that, maybe seeing a therapist for a little while would be helpful. A therapist can help you put things in perspective, can teach you some new skills and can support you while you try out new ways to be with other people.
I wish you well.