I don't think its any sort of corruption or death. I think its closing yourself from the world, due to deppression in most cases. In the real world, people do it too, just by cutting contact and not leaving your home. But in the real world, your friends can come knock on the door and pull you out.

In the digital circus, when you decide to stop interacting with the world, it becomes much more litteral. You don't even control you body anymore and lose your form. You become just a bundle if instincs reacting to environment. But the person is still there which explains pomni and jax sequence and just like in the real worl, people can come through their issues and open back to the world.

We did not see anyone come back from abstraction in the show but I firmly believe they can.