It’s losing air from the air piston into the fork leg (which is both why it’s going soft and also why it’s popping the seal out with the pressure) Needs at least a service, with any luck it’s just got a bad spring seal that a full service will sort.
My 2010 Teams developed a problem with the air spring assembly that needed some replacement parts over the service, can’t remember exactly what it was though- ended up being a job for the pros. At some point after that I coil converted them, which was dead easy with Sektor parts (I bought a whole knackered sektor for peanuts). Added a little weight but really made for a fantastic fork, might be a good option if the repair starts looking expensive.