I recently presented a webinar on XRF and Numismatics. Here are some major take-aways from the event.
Numismatics is the study or collection of coins, paper money, and other related objects such as medals. Numismatic coins are collectible coins that are valued for their age and rarity as much as their precious metal content. Numismatic coins are sold to and traded among collectors, who may be interested in them for their historical, cultural or investment value. They may be purchased from wholesalers, national and local retail outlets and brokers, and certification labs.
In recent years, counterfeiting has become a pervasive issue in the numismatics marketplace. Counterfeiters are becoming so skilled at replicating the weight, appearance, and strike cleanliness of real coins that high quality fakes can easily be passed off as genuine articles. The numismatic market has become risky for investors who may be dealing with brokers who are untrained, lacking in advanced analytical technologies, or simply unscrupulous.
We may see the numismatic market become more regulated in response to numerous consumer complaints about counterfeit coin scams. The recently enacted Minnesota Senate Bill 382, for example, calls for numismatics dealers to disclose in writing the exact precious metal content of the coins they sell, with penalties for failing to do so, or for misleading the buyer about the composition of the coins. Dealers will also face consequences for misrepresenting their qualifications to evaluate coins, and for failing to comply with agreed upon terms of sale.
If the Minnesota law proves successful, other states will likely follow suit. Furthermore, numismatic objects are more often being promoted as an investment rather than collector’s items, which may eventually lead to government oversight of the bullion coin market in a manner similar to the stock and bond markets.
Such industry shifts point to an increasing need for highly sophisticated analytical technologies to verify the precious metal content of numismatic coins.
Traditionally, dealers examine collectible coins using a loop, magnifying glass, or microscope to evaluate the overall presentation of the coin. A “ping” test may be conducted to get a general idea for the coin’s composition. An ice test can also be useful because coins with high silver content will cut through an ice cube faster than a coin with low silver content due to the high thermal conductivity of silver.
The mint year that is stamped on a numismatic can indicate its precious metal content, but there are cases where the composition is changed mid-year, voiding the date as a means of verification and changing the value dramatically. Identification by mint date is also impractical for wholesalers who don’t have time to evaluate each coin individually.
Such traditional methods are subjective. To really know the precious metal content of a coin or other numismatic specimen, a more analytical method of evaluation must be used, however, these also have flaws. Electrical resistivity works mainly on gold and platinum, not silver. Acid tests determine the karat value of gold coins but also damage the coin. Neither method can be used for detecting gold plating.
X-ray fluorescence (XRF) analyzers provide a fast, accurate, nondestructive alternative for assessing coins. XRF analyzers help coin dealers detect fraud and increase their overall operational efficiency because they quickly provide the exact karat weight and percentages of all precious metals and alloying within an item – easily identifying non-standard, under-karated, and even advanced counterfeit material that acid testing is incapable of differentiating. What’s more, some XRF instruments feature technology that can identify gold-plated items that may go undetected by more traditional test methods.
Read the American Numismatic Association’s Official Grading Standards to learn more about numismatic authentication.