It "should" but it doesn't. This thing detects failed prints. Not prints that are about to fail. Except if you cut the filament.
It is a *VERY OLD* design, the Internet is full of variations around this idea. They just payed some youtubers, created the hype, and make money. The filament sensor is probably the very first accessory a beginner will add to his brand new printer. We all did it.
An example from 2016 (6 years old, just one among many others) :
https://hackaday.com/2016/12/08/this-old-mouse-keeps-track-of-filament-usage/Remember that the OP was asking about spool tangle detection. Not about detecting a filament that someone had the brilliant idea to cut using pliers. A solution that can save he's print. Not some gadget that phushes a button saying "you're f*cked").
Again, do the math. The head will move 210mm (1.75 filament 0.4mm line width, 0.2mm layer) until it reacts, according to BTT recommendations (triggers after 7mm). Too late. It is a failed print. Wasted money, wasted plastic, wasted time.
[EDIT] DOES MARLIN TAKES THIS DISTANCE INTO ACCOUNT BEFORE IT RESUMES ? I doubt it can do it as it would require to rewind the gcodes...
Have a look to the 3D printers these youtubers have all around, watching their next videos. Do you see this device on their machines ? No. Why ? Because it is useless. They took the money and throwed this crap away. Otherwise all their machines would be equiped. Some are 3D printing for a living. And you will never see these sensors demonstrated in real world situation. Just the cutting pliers trick.
I'd love to hear Thunderf00t talk about this device. I doubt he's interested in such obvious debunking.
The only real well engineered device would be something that compares the length that enters the extruder against what goes out, and is fully integrated. Extruding and retracting. Maybe it exist in the industry world...
Look at this video. I'm sure the author is trying not to laught while mounting the sensor the BTT way :