Several independent organizations exist for the sole purpose of grading coins, including the highly reputable Professional Coin Grading Service (PCGS) or Numismatic Guaranty Corporation (NGC). For a nominal fee, individuals can submit a coin for grading, which will be returned certified, graded and sealed in a tamper-evident plastic container known as a “slab.”
Dealers themselves graded rare coins prior to the mid-1980s, raising serious conflict of interest issues that often resulted in fraudulent grading. The third-party grading services were established in response to this fraud, developing standards and practices that are now widely accepted. These organizations neither buy nor sell coins, so there are no conflicts of interest.
More than three million coins have been graded by third-party organizations to date, and the benefits they have brought to the rare coin industry are tremendous. Among the most important are standardized grading, improved liquidity, safe long-term storage, and guaranteed grading and authenticity to protect investors and collectors from fraud.