I've had this happen and unfortunately, it isn't a good move.
It confuses the boundaries of who to go to, and also you can get used very easily.
If you're a good leader, people will want to still come to you, and that could seem like undermining the new boss.
It also puts you in a position to be a target, or for people to gossip about you in ways that could be damaging about why you were demoted.
Once you get into your new IC position, you won't be responsible for the same things, but people will try to make you do them anyways because you know what you're doing, and that's a problem.
Speaking from experience, I tried to stay when this happened to me, and it did not turn out well. I was a better boss and just better at the job in general than the new manager. It made people come to me instead of her, and then she'd try to defer to me on things she didn't want to handle. As I no longer had authority, I couldn't execute, and it ruffled a lot of feather on other teams both because they liked me, and because I wasn't in the position to making those asks anymore. It became a big problem.
When I put in my notice, this new manager wouldn't accept it.
She had a sit down with me 3 times asking if I was really leaving or not and kept asking 'are you sure'? She even brought me to HR and kept asking.When I refused to rescind, saying I just wanted to finish my two weeks in peace, they walked me out.
It can get ugly, and if I were you, I'd bring this up to your management and bring your concerns. See if you can hold a position of authority, and not go to be an IC.
The only other option is to leave.Rarely are these places making these decisions that will allow you to be an IC in peace.
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