I received this penny as change from the post office today and it is spiraled from the edge to about 1mm in, I would assume it is PMD but my question is how? how does something like this happen? It is really interesting.
What does the reverse look like? Similar? It looks to me like something has applied crushing force to the coin, not a dremel. Notice how even though the surfaces are lower the copper plating is still intact. Any kind of a grinding would have stripped off the copper. This looks like something very heavy was placed on the cent and then rolled around the edge. Pinched between a couple of rollers and as they turned the cent rotated around?
the reverse is completely normal but the words around the rim (united states of America, one cent) are a little blackened
A coin placed between 2 pieces of back iron/galvanized pipe, and then in an arbor press or a shop pneumatic/hydraulic press would flatten the area. Since as you pointed out the plating is still there, and you can still see the top of his hair and the clothes lines, along with Liberty and some of the date. People that work in shops, some times do things to keep from being bored! I have some fun with these, As I stamp a bunch and the turned them back into the wild. In SE Michigan