Are central banks ahead of banknote counterfeiters?

Antti Heinonen analyses data on recent trends in counterfeiting

Canadian dollar notes
Canadian dollar banknotes from the 2011 ‘Frontiers’ series
KMR Photography

It is an old saying that central banks should be at least one step ahead of counterfeiters. A banknote is just a piece of paper, and its value depends on the trust in the issuer, one essential part of that being the note’s security. However, soon after the first paper money was issued the first counterfeits were discovered. Since then, the result has been an unending race between the issuing authorities and perpetrators.

In the early days, as a first measure, the use of watermarked paper, which

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