The Collaborative International Dictionary of English v.0.48:

demonetize \de*mon"e*tize\ (?; see Monetary), v. t.
   To deprive of current value; to withdraw from use, as money.
   [1913 Webster]

         They [gold mohurs] have been completely demonetized by
         the [East India] Company.                --R. Cobden.
   Demoniac

WordNet (r) 3.0 (2006):

demonetize
    v 1: deprive of value for payment; "demonetize a coin" [syn:
         demonetize, demonetise]