In all likelihood, this note was part of a bank robbery in the Mid-West (Chicago area) in the late 60’s or early ’70s when banks first started using these dye packs (but before or during the non-obligatory redemption period.) I can only imagine some poor, young bank teller being held up at gun point, and tossing this dye pack into the robber’s bag. Once the activated pack exploded, I can envision the infuriated robber covered in indelible red ink as were the banknotes.
We’ve seen exploded dye pack notes before, but never this dramatic. Usually seen on lower denominations and never with such substantial smears. The effect is impossible to replicate as the ink used in these packs has the ability to bleed right through bank note paper, will not come out and leaves a distinctive splatter pattern.
This is legal tender, entirely legal to possess, authenticated, graded and attributed by Paper Money Guaranty.