Old Currency
Currency pens do not work on paper currency older than 1959. The type of paper and manufacturing methods changed around 1960. The type of printing before 1960 was known as wet-printed notes. Today's counterfeit pens only detect modern U.S. currency paper, typically composed of 25 percent linen and 75 percent cotton. You will also find security threads made up of red and blue synthetic fibers throughout the paper.
Types of Paper
Currency detector pens contain an iodine solution designed to have a color reaction with the starch in wood-based paper. This reaction causes a dark stain in counterfeit or old money printed before 1959. The pen may create a golden or yellow reaction in today's fiber-based currency.
Modern $2 Bill
Despite popular belief, the $2 bill has never fallen out of circulation. The federal reserve has printed new editions of the $2 bill several times over the decades. A new version of the $2 bill complete with an updated security watermark and threads was printed in 2008. This updated bill will pass currency tests as it has been printed on modern, fiber-threaded currency paper.
Faulty Pens
Some currency pens, especially those that are 20 years old or more, detect for high levels of pH in paper. United States currency contains a high level of pH. Many types of paper stocks at an office supply store also contain high levels of pH and make it easy for someone to test a variety of papers and print counterfeit money. When such counterfeit money is used, it will pass the pH test currency pen.