Banknote
[3] National banknotes are often, but not always, legal tender, meaning that courts of law are required to recognize them as satisfactory payment of money debts.
Today, a central bank or treasury is generally solely responsible within a state or currency union for the issue of banknotes.
Commercial banks in the United States had legally issued banknotes before there was a national currency; however, these became subject to government authorization from 1863 to 1932.
In the last of these series, the issuing bank would stamp its name and promise to pay, along with the signatures of its president and cashier on a preprinted note.
By this time, the notes were standardized in appearance and not too different from Federal Reserve Notes.In a small number of countries, private banknote issuing continues to this day.
For example, by virtue of the complex constitutional setup in the United Kingdom, certain commercial banks in two countries (Scotland and Northern Ireland) continue to print their own banknotes for domestic circulation, even though they are not fiat money or declared in law as legal tender anywhere.
[5] In the two Special Administrative Regions of the People's Republic of China, arrangements are similar to those in the UK; in Hong Kong, three commercial banks are licensed to issue Hong Kong dollar notes,[6] and in Macau, banknotes of the Macanese pataca are issued by two different commercial banks.
Other related methods include watermarking to reduce the number of corner folds by strengthening this part of the note.
Another security feature is based on windows in the paper, which are covered by holographic foils to make it very hard to copy.
[citation needed] The attempts by the Bank of England and the Royal Mint to stamp out currency crime led to new policing strategies, including the increased use of entrapment.
[13] The characteristics of banknotes, their materials and production techniques (as well as their development over history) are topics that are not usually thoroughly examined by historians, even though there are now a number of works detailing how bank notes were actually constructed.
[17] Banks asked skilled engravers and artists to help them make their notes more difficult to counterfeit during the same time period, which historians refer to as "the search for the inimitable banknote."
Since then, many other countries have adopted circulating polymer banknotes, including Bangladesh, Brazil, Brunei, Canada, Chile, Guatemala, Dominican Republic, Hong Kong SAR (China), Indonesia, Israel, Malaysia, Mexico, Nepal, New Zealand, Nigeria, Papua New Guinea, Paraguay, the Philippines, Saudi Arabia, Romania, Samoa, Singapore, the Solomon Islands, Thailand, Trinidad and Tobago, the United Kingdom, Uruguay, Vietnam, and Zambia.
Polymer banknotes were developed to improve durability and prevent counterfeiting through incorporated security features, such as optically variable devices that are extremely difficult to reproduce.
[21] Silk and other fibers have been commonly used in the manufacture of various banknote papers, intended to provide both additional durability and security.
Banknotes printed on pure silk "paper" include "emergency money" Notgeld issues from a number of German towns in 1923 during a period of fiscal crisis and hyperinflation.
Banknotes printed on cloth include a number of Communist Revolutionary issues in China from areas such as Xinjiang, or Sinkiang, in the United Islamic Republic of East Turkestan in 1933.
A number of 19th-century issues are known in Germanic and Estonia, including the places of Dorpat, Pernau, Reval, Werro, and Woiseck.
The 2018 Hong Kong dollar banknotes series too has the obverse in traditional horizontal layout, while the reverse is in vertical format.
A subsequent briquettor compresses shredded paper material into a small cylindrical or rectangular form for disposal (e.g. landfill or burning).
A Canadian government report indicates: Types of contaminants include: notes found on a corpse, stagnant water, contaminated by human or animal body fluids such as urine, feces, vomit, infectious blood, fine hazardous powders from detonated explosives, dye pack and/or drugs...[31]In the US, the nickname "Fed Shreds" refers to paper money which has been shredded after becoming unfit for circulation.
[33] Polymer banknotes may be shredded and then melted down and recycled to form plastic products like building components, plumbing fittings, or compost bins.
Dynamic Intelligent Currency Encryption (DICE) is a security technology introduced in 2014 by the British company EDAQS that devalues banknotes remotely that are illegal or have been stolen.
The technology is based on identifiable banknotes—that could be an RFID chip or a barcode—and connects to a digital security system to verify the validity of the banknote.
The company claims that the banknotes are unforgeable and contribute to solving cash-related problems as well as fighting crime and terrorism.
On a related note, governments consider the DICE benefits to be a driving force behind the progressive abolition of cash because they cover and resolve almost all cash-related issues.
[35] In the United States, there are many laws that allow the confiscation of cash and other assets from the bearer if there is suspicion that the money came from an illegal activity.
