[braunshedd]

TLDR: When electronics burn out, they often release "magic smoke" that is believed to be the source of their power (since they almost always fail to work afterwards).

https://en.wikipedia.org/wiki/Magic_smoke

[Xen9]

I see, it's then from the same document as blinkenlights.

https://jargon-file.org/archive/jargon-4.4.6.dos.txt