"The US dollar is the global reserve currency, and a lot of people around the world want to hold dollars for various reasons"

There are, however, some people who have dollars that are worth less than $1. These people are most classically drug dealers [4] : You get some drugs, you sell them to users for cash, you have a lot of cash, you put a million dollars in a big sack and go to a bank to deposit it, the bank teller says “where did you get this cash,” you say “dru—I mean it was in my grandmother’s attic,” the teller says “hmm it smells like drugs,” you say “huh that’s weird I put it in a different bag from my drugs,” the teller says “wait right here for a minute,” and you are tackled by six cops and go to prison. [5] The $1 million in your sack was worth considerably less than $1 million to you: Rather than buying a Lamborghini (good), it bought you a long prison sentence (bad).

"Your drug dollars can be turned into regular dollars, but each drug dollar buys only 50 or 70 or 80 regular cents."

If you are a money launderer, obviously you should find them [6] : If you can buy a dollar for $0.70 (from a drug dealer), and sell it for $1.25 (in yuan, to someone evading Chinese currency controls), that is strictly better than turning it into $0.80 or even $1 of clean money.

One or two percent! I cannot really claim to be an expert in the money laundering market, but my impression is that the normal commission percentage is in the double digits: This is risky difficult illegal work, and nobody is going to do it for 1%