By CoinWeek Staff Reports …..
- CAC Grading Announces the Crossover of D.L. Hansen’s Barber Half Dollar Collection
- Crossovers of high-end collections to CAC may signal a shift in the market
- This week, CAC Grading will exhibit the coins at its booth at the Winter FUN Show in Orlando, Florida
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In a December 29, 2023 press release, CAC Grading of Virginia Beach announced that the firm had recently crossed a set of Barber half dollars from the D.L. Hansen Collection from PCGS holders to new CAC holders.
Of the crossover, CAC Grading President Ron Drzewucki wrote, “We are excited to have received these coins to crossover into CAC Grading holders.”
CAC Founder John Albanese confirmed the crossover with CoinWeek over the telephone and told us that the company had a commitment from Hansen to cross over other sections of his collection at a future time. The company is also in conversation with several high end collectors who have voiced interest in having CAC Grading reevaluate and encapsulate their holdings.
Hansen, a Utah businessman, is one of the leading collectors of United States coin and has an interest in both CAC and David Lawrence Rare Coins (DLRC). His efforts to assemble a super-Eliasberg Collection are well-documented; he is an active buyer of rare coins, and nearly all of the coins in his collection are among the finest known examples.
Crossovers Nothing New in the Grading Industry
Before CAC launched as a full-service grading company, the majority of high-end coins from America’s classic period of federal coinage (1792 – 1933) had already been accounted for and graded by either NGC or PCGS, or both. Over the course of 35+ years, the two grading services have often actively sought to gain business from each others’ customers by offering discounted grading fees for coins that have already been certified by the other service.
On its website, PCGS actively markets crossovers with the statement “The Best Coins Always End Up in PCGS Holders”. NGC also offers crossover services. What makes the crossover service different from a standard grading submission is the grading services will allow customers to submit coins already graded by the other company and crack them out of their original holder only if the coin meets or exceeds the grading opinion that is stated on the original insert. The benefit to the customer lies with the fact that there is no risk of a downgrade in the event that the second service does not agree with the first.
Hansen’s Motivations to Support CAC Grading
Hansen played a key role in John Albanese’s decision to launch a full-fledged grading service under the CAC brand.
CAC was founded by a group of coin dealers in 2007 with the stated goal of holding the line on coins graded by PCGS and NGC. As the market for coins evolved in the 2000s and 2010s, a noticeable shift in grading took hold. This shift became known to those in the hobby as “gradeflation”. Gradeflation’s causes are complex and are often caused by a natural retuning of the market. This was borne out in several 20th-century series, such as the Mercury dime and the Eisenhower dollar.
In other instances, the constant pressure put on the services by dealers (who comprise the bulk of submitters) caused a gradual loosening of grading standards over time.
In this shifting market environment, the CAC sticker became an insurance policy for high net worth collectors like Hansen, who trusted that the company would not apply its sticker to coins that it did not feel were strong for the grade. As the company’s profile grew, coins with CAC stickers consistently yielded higher prices at auction than coins in similar grades without them.
The adoption of plus grades by NGC and PCGS was an attempt by the services to answer the CAC sticker and establish a formal framework for high-end coins within the grade. All too often, plus coins served as a transitory grade and would eventually upgrade to the next full point higher.
For high net worth collectors like Hansen, “holding the line” was essential for the protection of their rare coin investments. This anxiety is often felt by those building competitive registry sets when new coins are made in top pop grades – especially when the consensus amongst collectors is that the new coins are overgraded.
As a result of gradeflation, many collectors at the elite level have demonstrated a willingness to downgrade their coins in order to qualify for a CAC sticker. In grading Hansen’s Barber half dollars, John Albanese told CoinWeek that a few coins downgraded and that Hansen was fine with that.
What the Hansen Submission Signals About the Market
The founding of CAC Grading poses an interesting challenge for both NGC and PCGS, but the challenge may be more acute for the Santa Ana, California grading firm because its market dominance in classic U.S. coins has never been overcome. If high-end collectors follow Hansen’s lead and crossover their top end coins, PCGS will find itself in a position where it will have to fight to protect the lead it has built over all of these years.
Both Albenese and Drzewucki have signaled to their shareholders that CAC is in this for the long haul. Albenese has been a major figure in coin grading since the launch of PCGS. Drzewucki is a well-regarded coin grader, who served as a finalizer at NGC before stepping down to launch Modern Coin Wholesale. Drzewucki is also a former CoinWeek content contributor.
For those interested in looking at the Hansen Barber half dollar collection are invited to stop by CAC Grading’s booth #1223 at the Florida United Numismatists (FUN) Convention, which is being held this week in Orlando, Florida.
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