Technically, this isn't really defacing. Defacing would render it unspendable by the treasury department's standards. There's even a provision in those regulations that permits the use of currency in art.
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This here is actually a little like the Where's George currency tracking project.
https://www.wheresgeorge.com
No, it is defacing. You're not allowed to mark bills at all. I worked at a bank and we had to take these out of circulation so they could be destroyed and new ones sent out. It costs about eight cents to print a new bill and it does add up. Where's george can't be prosecuted but by marking bills, you reduce the lifespan of the bill and increase the amount of money it costs to keep clean bills in circulation.
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This here is actually a little like the Where's George currency tracking project.
https://www.wheresgeorge.com
Cheers :)