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In this paper we propose a novel simple periodic optical encoder for centralized fault monitoring of fiber-to-the-X (FTTX) passive optical networks (PONs). This optical encoder exploits a fiber ring with a different length for each distribution/drop fiber to produce a different periodic code. This reduces the cost of monitoring system while maintains good performance and high capacity. We investigate the design issues of this coding based monitoring system and evaluate its performance in terms of signal to noise ratio (SNR), probability of false alarm (PFA) and probability of misdetection (PMD). We obtain an SNR of 12.5dB for a 32 customers network in one shot measurement. By repeating the measurement multiple times we achieve a capacity of 64 to 256 in expense of longer measurement time. Moreover, the system accomplishes a PMD ≈ 2 *10-9 for a PFA= 10-6 in a 64 customers network in 4ms.