5 ms·

An interesting counterpoint comes from coin collecting. You can send coins to a professional authenticator and grader, like PCGS or NGC, who would certify the

by hakfoo 5y ago

An interesting counterpoint comes from coin collecting. You can send coins to a professional authenticator and grader, like PCGS or NGC, who would certify the coin and place it in a serialized holder. Such "slabbed" coins are often easier to sell and command higher prices. This is a huge deal for some types, where a single point increase of grade (on a 70-point scale) turns $500 into $5000, and some where there are so many fakes that the standard best practice is to buy certified only. Originally, they'd just have a lookup system on their site so you could see "Certificate 123456 was assigned to a 1825 half dollar, graded XF-45". If someone's selling certificate 12456, but on a 1912 nickel, red flags. They still ended up with a problem of fake holders/certificates. Just scrape their database and get a cert number for the type and grade you're trying to sell, and pair it with a fake or lesser coin. So the next step was to include a high res photo of the coin in their repository. You could pull up a certificate and see "well, that's a 1825 half dollar in the container, but the one they graded has obviously different wear pattern, toning, die variety". This makes faking it much harder. Notice it didn't require a blockchain though. There's a clear chain of trust back to the grading service, who has been in business for decades and established their brand and usually guarantees that if they misauthenticate a coin, they'll make the buyer whole.

seibelj 5y ago
NFTs are purely digital assets. Expecting physical assets to meld with NFTs is a curiosity for which we will have to wait and see. The benefit of NFTs from the perspective of software is that computers can validate the authenticity with a function call. Blockchain-based financial systems can integrate with them to create interesting use cases.
- shiftpgdn 5y ago
  I’ve been playing around with the idea of a defi project where I mint NFTs for all of my PSA graded TCG cards which would allow you to return the NFT me to be “burned” and I’d ship you the underlying asset. This would allow someone to hold and have high liquidity in graded trading cards without every having to take possession of the underlying asset.
  - screaminghawk 5y ago
    Why burn the NFT? Wouldn't it be better to transfer the ownership of the NFT along with the physical item?
    - wmf 5y ago
      That gets back to crazygringo's point that someone down the line could sell the NFT paired with a counterfeit physical item and it might even be hard to tell who is the scammer and who is the victim.
  - adventured 5y ago
    Something like this is being messed around with by a few different companies in the form of fractional share ownership in cards, which is likely to be the form it ends up taking (a trusted market, ala the Nasdaq). So the market holds the 1952 Mickey Mantle and shares get issued against it. You can buy and sell the shares, you never need worry about taking possession of the underlying asset. The market holds the physical asset and insures it. If cards are going to have another level up from the single digit million dollar area, it'll be due to fractional ownership speculation. Up to this point, generally speaking, either a singular or very small number of people own the most expensive cards or can afford to own them. With fractional ownership, people can put $500 into a $5 million Mantle card, and own part of its appreciation over time. That flood of buyer demand will inevitably pop the total value of all the shares far higher than would otherwise occur for the card as a whole (which prompts the question of whether $30-$50 million type valuations end up happening for some of those cards, as in the art world). PWCC is one of the obvious candidates for building a giant holding market, with card IPOs or something akin to that. They already allow you to borrow against the cards you hold in their vault. I'd be surprised if they don't experiment with fractional ownership in the near future.
  - tac0_ 5y ago
    I had this exact same idea not long ago but with PSA graded Pokemon cards. Essentially a reserve for digitising real world assets and collectibles. The challenge would be convincing everyone that your reserves are always secure and properly backed.
WalterBright 5y ago
I gave up on coin collecting because of the terrible fraud problems, in every aspect of buying, selling, and grading. The whole business is a giant racket. Heck, you can't even hand a collection to a grader. He'll swap out your good coins for lesser ones when you aren't looking. Same with stamps.
- gerdesj 5y ago
  "Heck, you can't even hand a collection to a grader." If coins and stamps are worth enough - and many are then you need to start treating your assets with respect. I would consider things like markings that show up under ultraviolet light or a microdot - things that don't affect the article. Get the marking(s) asserted in some way. Make the grader aware that you have taken steps. If the value is great enough, then you might pay out for a minder that follows the article throughout the process. Perhaps there is a market for an intermediary service of some sort to do this job. Anyway, this has all been done before. You need to do a risk assessment on your stuff and protect yourself in proportion to the potential value of your things. Getting valuations done for any valuable thing is potentially problematic but I'm sure if you have a chat with, say, a jeweller they'll tell you how to get the job done safely.
  - WalterBright 5y ago
    One of the grading tricks I read about they'll do right in front of you. Hand them a stack of coins/stamps. They'll grade the first one very generously, so you'll think they're good. As they take their time one by one, you'll get bored/impatient and pay less and less attention. The lower down on the stack, the lower they'll grade them. Sure enough, I went to a coin dealer and that's exactly what they did.
    - hakfoo 5y ago
      I think you're looking at a different type of grader than the services I'm referring to. You're paying for the grading/encapsulation as a service, independent from any future sale plans, so they have no stake in under or over-grading any individual coin. They got their service charge (typically $15-100 or so depending on estimated value and turnaround speed) and they'd lose community trust if they were consistently too lenient. The market only trusts a handful of firms, most of who have been around since the 1980s or 1990s and certified millions of coins. Most other brands are "price it as you would an uncertified coin, caveat emptor" or perhaps even worse, as some sketchy dealers would set up a fourth rate grading service as a means to make low-quality inventory more appealing.

by hakfoo 5y ago

seibelj 5y ago

NFTs are purely digital assets. Expecting physical assets to meld with NFTs is a curiosity for which we will have to wait and see. The benefit of NFTs from the perspective of software is that computers can validate the authenticity with a function call. Blockchain-based financial systems can integrate with them to create interesting use cases.

shiftpgdn 5y ago
I’ve been playing around with the idea of a defi project where I mint NFTs for all of my PSA graded TCG cards which would allow you to return the NFT me to be “burned” and I’d ship you the underlying asset. This would allow someone to hold and have high liquidity in graded trading cards without every having to take possession of the underlying asset.
- screaminghawk 5y ago
  Why burn the NFT? Wouldn't it be better to transfer the ownership of the NFT along with the physical item?
  - wmf 5y ago
    That gets back to crazygringo's point that someone down the line could sell the NFT paired with a counterfeit physical item and it might even be hard to tell who is the scammer and who is the victim.
- adventured 5y ago
  Something like this is being messed around with by a few different companies in the form of fractional share ownership in cards, which is likely to be the form it ends up taking (a trusted market, ala the Nasdaq). So the market holds the 1952 Mickey Mantle and shares get issued against it. You can buy and sell the shares, you never need worry about taking possession of the underlying asset. The market holds the physical asset and insures it. If cards are going to have another level up from the single digit million dollar area, it'll be due to fractional ownership speculation. Up to this point, generally speaking, either a singular or very small number of people own the most expensive cards or can afford to own them. With fractional ownership, people can put $500 into a $5 million Mantle card, and own part of its appreciation over time. That flood of buyer demand will inevitably pop the total value of all the shares far higher than would otherwise occur for the card as a whole (which prompts the question of whether $30-$50 million type valuations end up happening for some of those cards, as in the art world). PWCC is one of the obvious candidates for building a giant holding market, with card IPOs or something akin to that. They already allow you to borrow against the cards you hold in their vault. I'd be surprised if they don't experiment with fractional ownership in the near future.
- tac0_ 5y ago
  I had this exact same idea not long ago but with PSA graded Pokemon cards. Essentially a reserve for digitising real world assets and collectibles. The challenge would be convincing everyone that your reserves are always secure and properly backed.

WalterBright 5y ago

I gave up on coin collecting because of the terrible fraud problems, in every aspect of buying, selling, and grading. The whole business is a giant racket. Heck, you can't even hand a collection to a grader. He'll swap out your good coins for lesser ones when you aren't looking. Same with stamps.

gerdesj 5y ago
"Heck, you can't even hand a collection to a grader." If coins and stamps are worth enough - and many are then you need to start treating your assets with respect. I would consider things like markings that show up under ultraviolet light or a microdot - things that don't affect the article. Get the marking(s) asserted in some way. Make the grader aware that you have taken steps. If the value is great enough, then you might pay out for a minder that follows the article throughout the process. Perhaps there is a market for an intermediary service of some sort to do this job. Anyway, this has all been done before. You need to do a risk assessment on your stuff and protect yourself in proportion to the potential value of your things. Getting valuations done for any valuable thing is potentially problematic but I'm sure if you have a chat with, say, a jeweller they'll tell you how to get the job done safely.
- WalterBright 5y ago
  One of the grading tricks I read about they'll do right in front of you. Hand them a stack of coins/stamps. They'll grade the first one very generously, so you'll think they're good. As they take their time one by one, you'll get bored/impatient and pay less and less attention. The lower down on the stack, the lower they'll grade them. Sure enough, I went to a coin dealer and that's exactly what they did.
  - hakfoo 5y ago
    I think you're looking at a different type of grader than the services I'm referring to. You're paying for the grading/encapsulation as a service, independent from any future sale plans, so they have no stake in under or over-grading any individual coin. They got their service charge (typically $15-100 or so depending on estimated value and turnaround speed) and they'd lose community trust if they were consistently too lenient. The market only trusts a handful of firms, most of who have been around since the 1980s or 1990s and certified millions of coins. Most other brands are "price it as you would an uncertified coin, caveat emptor" or perhaps even worse, as some sketchy dealers would set up a fourth rate grading service as a means to make low-quality inventory more appealing.