Demurrage is a loss or fee that is incurred due to violation of time agreement between parties, or the inefficient allocation of capital.

     Within the context of cryptocurrency and digital assets, demurrage is the loss that a node might incur by running inadequate hardware for mining; essentially just wasting electrical energy. Another example of demurrage in crypto is among staking nodes. If it costs $1,000 to setup a node that produces 5% annually, and the value of the stake went down by ~30%, then that economic nuance is called a demurrage.

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