This didn't get answered before so I'm trying again, since season 2 starts today.
These questions are assuming that Narcos is somewhat accurate in the depiction of the amount of US dollars shown. I was watching Narcos and saw that they mostly show US dollars, how easy was it to spend in Colombia? What was its buying power? Would Colombian banks take American funds? Since a large amount of American funds were moved by the cartels, were people in possession of US bills assumed to be connected to the drug trade? How did this cash move back to Colombia? Was there a significant change to the US/Colombian exchange rate? Were other currencies involved, like Canadian, Mexican, ect?
This is something that I'm going to come at from a monetary perspective and not from a historical perspective, though there definitely is a historical component.
The official currency of Columbia is the Columbian Peso, which is practically worthless. It's nearly 3,000 pesos to the dollar. Looking at this chart http://www.xe.com/currencycharts/?from=USD&to=COP&view=10Y which shows the fluctuations of the Columbian Peso over the last 10 years. In 2008, it was about 1700 pesos to the dollar, which is a really good exchange rate (if you're Columbian) compared to the 3400 pesos it was at the start of the year. In that same amount of time, the US inflation rate has stayed under 3% (and in recent years has been under 1%) meaning that the US economy is doing pretty well.
If your suitcase of $1,000,000 is going to be worth $1,000,000 today, this week, and probably about the same all year, then it's a good store of wealth. If your 1,000,000 Colombian Pesos today might only be worth 400,000 pesos by the end of the year, then that's a really bad store of wealth.
So because the US economy is much more stable than the Colombian economy for a whole bunch of reasons that I'm not going to try to attempt to answer, the cartel method of doing everything in US dollars makes sense.
The US dollar has also been historically very strong. Many countries accept it as currency. In some parts of Canada, for instance, there are prices for things in CN dollars and US dollars. Pretty much anywhere outside of the Eurozone (and like England and a few other places), businesses would be more than happy to take your US money off of your hands.
Does this make sense?