The grading giant: how PSA shapes the pokémon card market

The surge in demand for card grading—the process of verifying authenticity and condition—reflects a growing trend of collectors and investors treating trading and vintage sports cards as alternative assets. PSA currently faces a backlog of 7.2 million items, a decrease from 12.4 million in July. The company temporarily halted lower-cost submission services in June to address the backlog, resuming its Value service on October 29th.

Many sellers prioritize PSA grading due to the higher prices typically commanded by PSA-graded cards, according to Geoff Wilson, founder and CEO of CardsHQ, a major sports card retailer. “It really all comes down to secondary market values,” Wilson stated.

A 1999 Base Set Charizard graded PSA 9 sold for approximately $3,440 on eBay on September 29th, while a CGC 9 copy fetched around $1,890 on the same day, according to data from PriceCharting.

This price difference reinforces PSA’s market position and gives the company considerable influence over the resale market. PSA has not yet responded to detailed questions from CNBC. The company has attributed service restrictions and pricing adjustments to exceeding grading capacity and has outlined investments aimed at reducing the backlog.

Grading companies like PSA verify a card’s authenticity, assess its condition, and encapsulate it in a protective plastic case, or “slab.” PSA utilizes a 10-point scale, with a Gem Mint 10 designation reserved for cards deemed “virtually perfect.” This grading system provides a standardized benchmark for buyers and sellers, streamlining transactions and facilitating cross-border trading, according to an unnamed spokesperson for Oxley Grading.

PSA’s dominance is attributed to its early entry into the market, strong brand recognition, and extensive sales history. Approximately 90% of graded cards offered for sale through Oxley Grading carry a PSA label, illustrating the brand’s pervasive influence.

This creates a cycle where buyers seek PSA-graded cards, incentivizing sellers to use the service, further reinforcing the brand’s visibility and demand. While competitors may offer lower fees or faster turnaround times, the established resale value often outweighs these advantages for sellers.

PSA is part of a larger collectibles business owned by Collectors, which also includes rival grading brands Beckett and SGC, pricing-data platform Card Ladder, the PSA Vault, and financial services. The PSA Vault provides storage and facilitates sales through external marketplaces like eBay.

Together, these businesses cover a significant portion of a card’s commercial journey, from grading and pricing to storage, sales, and even financing. Collectors’ grading brands accounted for roughly 71% of August grading volume among major firms, with PSA alone representing approximately 65%.

Collectors’ consolidation has faced legal challenges. A class action lawsuit filed in April alleges that the acquisitions of SGC and Beckett unlawfully reduced competition in card grading, claims that have not been proven in court. Collectors maintains that these acquisitions strengthen trusted brands and preserve collector choice.

Changes to PSA’s fees and submission services impact the economics of card grading, particularly for sellers who rely on the resale premium. PSA increased fees in February and lengthened estimated turnaround times to manage submission demand. The suspension of cheaper tiers in June limited affordable options, prompting customers to be more selective about submissions, according to Oxley Grading’s spokesperson.

Wilson noted that the restrictions have disproportionately affected collectors and dealers who buy ungraded cards, grade them through PSA, and then resell them at a higher price. This strategy has become less viable for cards valued at a few hundred dollars or less.

PSA has acknowledged customer wait times, citing a 2.5 times increase in submissions compared to the previous year. The company announced shorter turnaround estimates for certain services and stated that new Value submissions would be processed after existing orders. “We have added an incredible amount of capacity, but we still have work to do,” said Ryan Hoge, president of PSA and grading at Collectors.

Despite these investments, PSA’s dominance limits collectors’ bargaining power, according to the Oxley Grading spokesperson. “PSA’s lead comes from resale demand and liquidity, and other labels are still building that.” Limited grading options for overseas customers, who often face U.S.-based services, and disappointment with lower-than-expected grades are common complaints, according to Amber Chuah, operations manager of trading-card platform TCG Marketplace.