[The government imposes] price control by coercion on the “exchange rate” between the two types of coin. By insisting on the par-ratio when the worn coins (bad money) should exchange at 10 percent discount, it artificially overvalues the worn coins and undervalues new coins (good money). Consequently, everyone will circulate the worn coins, and hoard or export the new. “Bad money drives out good money,” then, not on the free market, but as the direct result of governmental intervention in the market.
Source: "What Has Government Done to Our Money?" by Murray N. Rothbard.