Upcycle: The process of converting a material into something of similar or greater value, in its second life. Aluminum and glass, for example, can usually be upcycled into the same quality of aluminum and glass as the original products.
Downcycle: Most recycled materials lose viability or value in the process of recycling. This means they can only be used in a degraded form for components other than their original use. White writing paper, for example, is often downcycled into materials such as cardboard and cannot be used to create more premium writing paper.
Source: Sustainability Dictionary
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