Maybe degradedegrade... Or downgradedowngrade.
Depending on your context one of these option may be better than the other. Both carry the connotation of being relegated to a lower level or grade, but both are not equal in tone.
Degrade holds a negative connotation and implies that the action had a malicious intent. Downgrade has a more utilitarian tone, and implies less emotional motivation for the action.
Your two suggestion feel a little more emotionally charged to me, so maybe degrade would be the better option of the two.