Bitcoin & Gresham's Law - the economic inevitability of Collapse
Philipp Güring & Ian Grigg
October-December 2011

Abstract.  The Bitcoin economy exhibits remarkable and predictable stability on the supply side based on the power
costs of mining.  However, that stability is challenged if cost-curve assumption is not solely expressed by the fair cost
of power.  As there is at least one major player, the botnets, that can operate at a power-cost-curve of zero, the result
is a breach of Gresham's Law:  stolen electricity will drive out honest mining.  This has unfortunate effects for the
stability of the Bitcoin economy, and the result is inevitable collapse.

http://iang.org/papers/BitcoinBreachesGreshamsLaw.pdf