The electronics supply chain is seeing evidence of increased sophistication in the counterfeiting of complex ICs and simple passives, both of which can impact the functioning and safety of the systems that use them.
New technologies are being developed to build trust by helping to identify counterfeit devices before assembly and during failure analysis. It’s too early to tell how effective those measures will be, but individual component identification is becoming an important tool in that effort.
“Trust requires looking at the whole value chain, from design through manufacturing, and carefully monitoring every step,” said Tom Katsioulas, head of trust-chain business at Mentor, a Siemens Business. “Security is about the digital assets. Trust is about the physical assets. And identity connects the two.”
Questions about authenticity can occur at a supplier, with contractors to a supplier, or during the movement of components between contractors and to the customer. The types of anti-counterfeiting options to be used depend both on the value of the component and the consequences of fake components. But they all focus on the ability to uniquely identify a component so it can be tracked through final system assembly.
Counterfeiting can occur anywhere there’s a reliable revenue stream. “There’s $70 billion a year in printer consumables sold into the world,” said Scott Best, technical director of anti-counterfeiting products at Rambus. “This is a remarkable opportunity for counterfeiters. It is a $10 million effort to take apart somebody else’s security chip, completely reverse engineer it (the reverse engineering is completely legal), and print a functional clone. That’s 50 people for a couple of years. But if you can do it, there’s a guaranteed $100 million annual product stream from that chip.”
In addition to lost revenues and profits, safety is driving much of the concern today. “What I’ve seen now are other, more important markets, looking for anti-counterfeiting solutions because of safety issues,” added Best.
This changes the stakes of counterfeiting. “If this is a Gucci bag, you [as a customer] might have lost if you paid for a real one and got a fake one,” said Ophir Gaathon, CEO of Dust Identity. “Clearly, an airbag has a completely different implication.”
Fig. 1: An illustration of the many aspects of the supply chain for an electronic device. Source: Keyfactor
Anti-counterfeiting measures have similarities with traceability, especially when it comes to developing unique component IDs. While such IDs solve two different problems, they go much further with anti-counterfeiting. Critically, wherever economically feasible, counterfeiting protections can be used in a forward-looking manner — as a system is being assembled. They also help in retrospect if a failure ends up being caused by a counterfeit component.
“One of the big problems is being able to identify a part, and there have been different tag technologies that have surfaced over the years to address that,” said John Hallman, product manager for trust and security at OneSpin Solutions. “If you go back 10 years ago, there were attempts to attach DNA tags. They’ve made some progress. Now there are all sorts of electronic IDs, where you have an identifier that is random in silicon, and authorization technologies. We’re looking at verification data as a unique identifier, where you take verification data and attach that to the IP using blockchain technology.”
In effect, that data becomes unique down to the individual bit. “That data can then stay with the device, and if someone modifies it, you can see that,” Hallman said. “This approach turns the problem of trying to look at a piece of IP or chip and assess it into one of how to build this into a device so it can travel along with that IP. The data stays encrypted and is connected in an external database.”
Zero trust Trust traditionally has been established at the organization level by vetting. But just having an approved vendor is no longer good enough. “The problem with ‘trust, but verify’ is that you’re assuming trust at the outset,” said Steve Carlson, director, aerospace and defense solutions at Cadence.. “And if you do some verification one time, then you say, ‘Okay, now they’re trustworthy,’ then they have free rein within the system.”
The newer approach is to assume that, at any given time, no entity can be trusted without proof, no matter how many times that proof has been given in the past. It’s called “zero trust,” and it treats every interaction as if it was the first. “It was a false notion that because the manufacturing was onshore, you could trust that supplier because it was done through ‘guns, guards and gates,’” Carlson noted.
But humans in the process can reduce the level of trust. “When we’re talking about zero trust and zero touch, where we don’t want to include advanced human intervention in the various stages, automation is key,” said Ellen Boehm, senior director of IoT product management at Keyfactor.
Trusting devices The notion of “trust” is an overarching concept that covers many specific elements. One of them has to do with whether or not one trusts the components going into a system as being authentic or counterfeit. Assigning each such component a unique identifier – “serialization” — is one step toward being able to authenticate components.
But serialization can be a challenge. “The biggest problems with serialization are the commitment to specific serial numbers, having all participants in the ecosystem commit to the same serial numbers, and having a system that will be able to recall the serial numbers,” said Gaathon. This creates a need for more sophisticated approaches.
An electronic system — whether a satellite, automobile, or high-availability computer — can have an extremely sophisticated supply chain. Chips and passives are assembled onto boards, boards are assembled into modules, and modules come together into a finished system.
“There’s a difference between identity and identifiers,” noted Katsioulas. “I may have identifiers for multiple purposes. For a single device, between design, manufacturing, and assembly, before I ship the chips out to the wilderness, I can have three or four or five identifiers. I create a unified identity that consists of those identifiers.”
It’s also important to consider that, while there is always a risk of a rogue operator within an organization, much of the vulnerability comes when components or sub-assemblies are transferred between different participants in the supply chain — or even between different plants belonging to a single supplier.
Identifying ICs The focus of most ID efforts has been on silicon chips, for a couple of reasons. The most obvious is the fact that these tend to be the high-value components that supply much of the differentiation in a system. The second reason is the fact that they’re amenable to having an electronic ID that can be interrogated and read, either while the chip is isolated or while it’s in a system.
There are several approaches to creating a unique chip ID. They overlap, so conceptually they could be used in a complementary fashion. The chip ID that has received the most attention is an electronically addressable ID. Used for traceability, it could be created during manufacturing using a number of different techniques. But counterfeiting places more constraints on the ways such an ID can be established. “[With] an injected ID, you create some secret number on a server,” said Dave Huntley, business development at PDF Solutions and co-chair of three SEMI committees/task forces. “Then you have the problem of who’s controlling the server.”
The gold standard is an ID that originates in the chip itself, which is an internal hardware root of trust (HRoT). “The alternative is based on physical properties of the actual device,” said Huntley. “And when it powers up, it creates its own unique identity at that moment.”
There are different ways of implementing this, but the one that receives the most mentions is the physically unclonable function (PUF). A PUF leverages some random source of high entropy, like the random power-up state of an SRAM array, to establish an identity. Because the ID is intrinsic to the device, it is immutable. That is an important characteristic of any component ID.
With such a device, the first time it powers up, it “enrolls” its ID. From that point forward, it can identify or “authenticate” itself during manufacturing and even after deployment. Systems can verify all of their chips on each power-up to ensure that nothing has been tampered with
HRoTs serve several purposes, including acting as a seed for public and private keys. For the purposes of those applications, it’s essential — and fundamental — that the actual value returned by the HRoT be confidential in order to protect those keys. It should never leave the device. But a component ID, by definition, must be able to leave the device. So the component ID can also be derived from the HRoT, just like the keys. The HRoT value remains hidden, while the derived ID can be made visible.
For chips that don’t implement a HRoT, it’s still possible to inject an ID. This must be done within a trusted environment to ensure that the equipment loading the ID into the chip and storage of the ID cannot be hacked or gamed.
There are other complementary approaches to proving the integrity of an IC. One technique assures that a given IC has been built using approved masks rather than an altered mask set. “Cadence has technology that essentially imprints some ‘DNA’ into the mask set to be able to detect whether or not the masks were altered,” said Carlson.
This approach is useful only during processing, however, because successive layers of masks will cover the underlying “DNA” traces. Once the device is complete, this approach is no longer useful for validating the chip. “The pattern is put into the mask during the steps that include multi-patterning for mask generation. The choice of layers and locations is a part of the decision process based on mid-manufacturing access to sample wafers,” noted Carlson.
There are also visual cues that can be used to identify an ID. “Multibeam [e-beam] is making it possible to write identifiers on a device in silicon — not electrically, but visually — so you have to get an electron microscope to look at it,” said Huntley. This has the benefit of being created outside the electronic testing flow, and so it can’t be gamed in the same manner as an electronic ID. But electronic and visual IDs are still likely to be used together. “Once that chip is on the circuit board and it’s in a product, you can no longer see it,” said Michael Ford, senior director of emerging industry strategy at Aegis Software and chair of three committees for the IPC standards body. “So visual IDs do not work.”
Passive components Passives, such as resistors and capacitors, are often considered to be low-value components that don’t merit the attention lavished on ICs. But there are significant efforts to counterfeit them, as well. “I went to this MTA counterfeit summit, and I was blown away by people talking about fake resistors and counterfeit capacitors and the impact it has in the supply chain,” said Katsioulas.
He’s not alone. “The greatest increase in counterfeiting has been in ceramic condensers,” said Ford. “It’s because there was a shortage in the market. [The counterfeits] looked like capacitors and they behaved like capacitors. The only difference was the dielectric was of a lower quality than normal.”
This can have real-world impacts. “There was a specific case where an Air-Force jet went up, and the ‘Friend or Foe’ circuit failed,” continued Ford. “They thought one of the big PGAs had been counterfeited. But it was the ceramic condenser, because the signal goes through the passive component to get to the PGA.”
Many such passives arrive mounted on reels. As a result, they’re naturally serialized, and it’s theoretically possible to do individual incoming inspection. “If you have a box full of reels, you might choose to have something that, you know, verifies the box first, opens the box, opens the reels, put the reels on a [spool], and reads all the package IDs in the background before it gets put into production,” said Huntley.
But today, identifying individual passives is likely too cumbersome. Instead, the reel gets a batch ID, and any passive is noted to have come from that reel. “Verifying every single capacitor is probably not worth it,” Huntley observed.
Alric Althoff, senior hardware security engineer at Tortuga Logic, agreed. “It’s going to be hard to do this beyond batches,” he said. While a system might not be traceable back to a specific passive device, it would be traceable to the batch from which the device came.
That’s not necessarily fail-safe, because there are some sophisticated efforts afoot to get counterfeits past incoming quality checks. “There was one case we saw where there was a reel of SMT components, and the first 100 were genuine,” said Ford. “And then every seventh one was a counterfeit. So this has been a reel which has been taken by somebody, all the parts taken off, and then the parts put back on again, specifically designed to defeat any incoming inspection regime. If somebody were to find an unexpectedly high quality problem, it’s so random that they can’t find a path to the responsible party.”
Meanwhile, not all assembly is automated. “For manual assembly, it’s a little trickier, because they have bins of components that are just filled up from time to time,” said Ford. “So you have to have procedures to make sure that you never mix the different batches or lots of components within a bin.
One challenge with batches is that batch size doesn’t always match assembly demands. “Let’s say you need to make 100 products, and on those hundred products you use two of a certain component,” Ford said. “So you’re going to use 200 parts. But the parts come on a reel of 1,000. So ERP thinks you’re going to use the 200 parts, and it allocates those. The other 800 have to be there just because they’re physically connected.
“Meanwhile, on a different production line, a guy runs out of materials because there’s some issue. He doesn’t care about anything other than getting his line running, because that’s what he’s judged on.” So some of the 800 parts get used there, without proper tracking. “This is happening all the time in every manufacturing company unless they have transitioned to lean material management,” he added.
Once components are identified, either individually or in batches, they’ll be assembled onto boards and into subsystems. Those units also will need identification.
Crypto enthusiasts and industry observers alike are asking what happened after the joyous announcements and parties. A better question would be to ask what happened before all that. In short, there is an essential mismatch between the original vision in 2017 and the original actions taken in 2018. To see the mismatch, ask yourself a … Continued
The Malta “Blockchain Island” story that captured crypto-loving hearts in 2018 came to a sudden end in early 2020. The announcement by the Maltese government that it is pivoting to becoming a fintech center is only the most direct message this year of the failure by the government to square the circle of cryptocurrencies and the legacy system. Other signs, mostly confined to the banking sector, confirm the change.
Crypto enthusiasts and industry observers alike are asking what happened after the joyous announcements and parties. A better question would be to ask what happened before all that. In short, there is an essential mismatch between the original vision in 2017 and the original actions taken in 2018. To see the mismatch, ask yourself a question: “Why would I brand a coin haven, ‘Blockchain Island’?”
One of six
BeInCrypto asked Steve Tendon, who coined the phrase “Blockchain Island” in 2017, about the mismatch. He replied that cryptocurrency was only one of the six main points underlying the blockchain concept. These points were:
Public registries/services on the blockchain;
R&D, education and innovation with and on the blockchain;
Appoint a blockchain regulator and create a regulatory infrastructure;
Regulate cryptocurrencies/tokens, including exchanges and initial coin offerings (ICO);
E-residency and digital identity (of individuals and legal entities) on the blockchain;
However, the focus quickly fell upon cryptocurrency. On Feb. 23, 2017, at the CEPS Ideas Lab conference, Malta’s then-Prime Minister Joseph Muscat claimed that “Europe should become the bitcoin continent.” Tendon notes in his Chain Strategies blog post on Malta’s course that:
“A lot of work had to be done to refocus the project on the idea that blockchain technologies, and not cryptocurrencies, had to take center stage.”
Moves to realize the non-crypto aspects of the vision commenced. The Ministry of Education and Employment announced in 2017, that it would put academic records on blockchain. The fanfare was minimal.
Despite the attempt to keep to the original script, though, the allure of crypto proved overwhelming.
The idea was simple, if you believed Muscat. In 2018, Malta would pass three laws designed to set the country up as “Blockchain Island.” In the face of ever-tightening regulation in the United States and in particular Asia, the vision of a crypto haven would catch the attention of many companies in the industry. In the short term, it worked.
The three laws, passed on July 4, 2018, were met with great acclaim in the industry. These laws were:
Virtual Financial Assets Act (VFA Act);
Innovative Technology Arrangement and Services Act (ITAS Act);
Malta Digital Innovation Authority Act (MDIA Act).
Commercial confirmation of Muscat’s vision came as well. Binance, the largest trading platform in the world, at the time, landed in Malta precisely because of fears of regulatory issues in Hong Kong, after being banned in Japan early in 2018. Shortly afterward, Binance’s main competitor on the exchange markets, OKEx, followed suit.
However, cracks began to appear, once implementation met bureaucratic and commercial realities. Incoming companies wrangled with bureaucratic issues. But at the heart of the matter was banking. It became very difficult for crypto startups to be banked in Malta.
Banking their replacements – not
Malta’s efforts ran into a commercial snag: banks were in no hurry to service blockchain and crypto-oriented companies setting up shop on the island. The irony of banks refusing to open accounts for companies who are setting up an alternative to banks seems to have been lost, but the problem is real enough.
Malta’s largest banks, HSBC and Bank of Valetta, are under direct European Central Bank (ECB) scrutiny due to their market share. However, smaller banks trying to fill the gap in the local market soon learned to fear getting caught up in money laundering schemes and becoming the next example of what happens when banks go bad.
Malta Financial Services Authority (MFSA) has launched investigations into — and recommended that the ECB revoke the licences of — a few banks that catered to igaming and financial services, but also engaged in suspicious transactions. These moves by the MFSA occurred while Malta faced attention from the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL).
MONEYVAL’s committee visited Malta in November 2018 as part of their review of the country’s status in implementing anti-money laundering (AML) and countering the financing of terrorism (CFT) measures.
MONEYVAL found Malta’s AML/CFT implementation to be spotty, especially in terms of investigations and enforcement. After an unimpressive 2019 follow-up visit, MONEYVAL gave the country a year to clean house or be placed under even greater monitoring measures.
Malta’s investigations into Pilatus Bank and Satabank were attempts to signal to all that the government could flex its muscles. Gaining bank accounts as well as licences would be an uphill battle. Tendon told BeInCrypto that reputational risk could well have taken its toll in this matter.
Physical events in Malta also had a bearing on the course of the would-be crypto haven. PM Muscat was linked substantially with the now infamous “Panama Papers” leaks by murdered journalist Daphne Anne Vella. Muscat, who had won a second term in the July 2017 general election, was forced out of office due to the ensuing scandal. He resigned effective Jan. 13, 2020.
The new government of PM Robert Abela is progressively moving Malta’s stance away from the previous emphasis on crypto-focused companies and toward a more nuanced return to Tendon’s original idea. The government introduced a regulatory sandbox for fintech companies in July 2020.
A full 70 per cent of the companies, which flocked to Malta at the beginning of the crypto haven phase, failed to file for full licensing. Malta is not begging them to return, and the new government gained attention by reporting to media that anchor Binance was not Malta-licensed in financial services terms.
Onward to 2021
Maltese regulators have been busy in fall 2020. At the end of October, VAIOT, a developer of AI-powered digital services, successfully registered its white paper with MFSA and thus became the first project regulated under the VFAA.
On Nov. 24, Crypto.com gained both a Financial Institution License and a Class 3 Virtual Financial Assets License.
Despite the twists and turns of Malta’s journey, the essential, blockchain regulatory structure remains for the government to build upon. As Tendon told BeInCrypto: “The MDIA act and the ITAS act are still two ground-breaking laws that would serve as the basis for a ‘blockchain’-focused agenda.”
James Hydzik is a finance and technology writer and editor based in Kyiv, Ukraine. He is especially interested in the development of regulation in the face of increasingly rapid technological change. He previously covered the CEE region for Financial Times banking and FDI magazines. An ardent believer in gut renovating eastern Europe one flat at a time, he currently holds more home renovation gear than crypto.
Blockchain Voting is Possible: Dispelling Myths & Fears
Part of the motivation for this discussion stems from a clearer picture of the problems that we hope to move away from — namely, voter suppression, low turnout, and slow and costly election infrastructure. This past year, marked by the COVID-19 pandemic, has taught us that we must be prepared to exercise democracy through any … Continued
Many of us in the field of digital voting have noticed a drastic shift in public discourse throughout this past year. Supporters and skeptics alike have become increasingly vocal, and it seems more and more people are forming an opinion on the topic. The question is shifting away from whether or not digital voting will become widespread in the next decade and instead rests on how this shift will happen.
Part of the motivation for this discussion stems from a clearer picture of the problems that we hope to move away from — namely, voter suppression, low turnout, and slow and costly election infrastructure. This past year, marked by the COVID-19 pandemic, has taught us that we must be prepared to exercise democracy through any and all conditions.
Beyond this reaction to the problems inherent in our current voting systems, however, is a vision of an entirely different governance model with deeper citizen participation and engagement.
What if blockchain voting could enable us to self-organize in a democratic and participatory manner at a larger scale than ever before? With secure, anonymous, universally-verifiable, and extremely user-friendly voting from a mobile phone, such a shift is possible.
Debunking blockchain voting myths
Unfortunately, fear of blockchain voting systems is at an all-time high. Many critics, including authors of a recent paper from the MIT Medialab’s Digital Currency Initiative, point to very real problems with the technology that will have to be addressed. But many also inflate these problems, fall into common misconceptions, and mistakenly declare blockchain voting irredeemable.
Let’s break down some of these myths.
Blockchain voting can’t be anonymous
One of the most prevalent myths about blockchain voting is that it precludes voter anonymity. For a system, which relies solely on blockchain, this is true. And anonymity is certainly a challenge.
But as my colleagues and I at the digital voting project Vocdoni point out in our reply to the aforementioned MIT paper, this requirement is achievable. The technology for breaking the link between a voter and their individual ballot, while preserving verifiability, already exists (with some room for improvement).
Blockchain voting can’t be as secure as paper-ballot voting
Skeptics of blockchain voting systems tend to point out the vulnerabilities of closed-source solutions which rely on blockchain but include centralized, trusted components. They also point out other weaknesses like hardware vulnerabilities.
There’s no reason a blockchain voting system can’t be fully open-source, publicly auditable, and distributed among trustless decentralized components. As mentioned above, this technology already exists and provides complete verifiability for each vote from the time it leaves a voter’s phone to the publishing of results.
One of the ongoing challenges to the security of such a system is users’ phones themselves. Many point out that it’s impossible to verify that a device is uncompromised, and this is technically true.
Mitigation measures such as encrypted and separated storage, multi-factor authentication, and password keylogger protection significantly reduce the attack surface, but any mobile solution would ultimately rely on the security of the underlying operating systems. This is something to be improved upon, not to be cast away as hopeless. With each mitigation measure attacks become more difficult to employ and less scalable.
Blockchain voting brings more coercion and vote buying
As elections go digital, the potential for coercion and vote buying increases dramatically. Attacks become easier to scale and automate. Many believe that this problem is inevitable and indefensible.
While coercion and vote buying are major issues, there are several innovations that could mitigate or eliminate the threat.
First, a system could allow voters to amend their votes during an election period (before votes are counted). Someone who is coerced into voting a certain way could later change their vote.
Second, vote verification could be designed to allow users to prove they own a certain vote only until an election ends, at which point anyone could generate a proof for any vote. This would make it much more difficult for users to prove their vote to a nefarious outside party.
And third, ongoing efforts are promising: while it is not yet implemented, research shows theoretical backing for a design, which would anonymize the content of each ballot, effectively making it impossible for a voter to prove their vote in exchange for a reward.
Perhaps the greatest roadblock to the adoption of blockchain voting is its human component. News media has a tendency to over-state the risk of fraud in our current systems, and this would only increase with further digitization.
Early-adopters of the technology would take a huge reputational risk. Furthermore, the potential democratization of governance that makes blockchain voting so inspiring might be the very reason many governments shy away from it.
This challenge can only be tackled through persistent advocacy for better democratic methods. We must highlight the power of blockchain voting to enable a participation model that goes far beyond sparse general elections.
The good news is that there are already several national and local governments, such as Switzerland and Estonia, with extensive records of successful digital voting processes. And we believe this trend will grow in the coming years. We need to make sure that — as the use of digital voting expands — it is done with the best technology available.
Blockchain voting is certainly an uphill battle. Each of these concerns is a mix of real-world challenges and widely-held misconceptions that need to be teased out from each other and addressed.
But we believe that we have solved the core issues at hand, and what we need now is time, iteration, and testing. Just like paper-ballot voting systems, which initially had to overcome many of the same problems, blockchain voting must evolve and improve over the course of its use.
It cannot be overstated that there are challenges inherent in any digital voting system, and blockchain will never be an easy, catch-all solution. Rather than shying away from this difficulty, in a world where digital voting is likely inevitable, we should design systems with our aspirations in mind.
NOTE: The views expressed here are those of the author’s and do not necessarily represent or reflect the views of BeInCrypto.
Written by Nate Williams, a recent graduate and full-stack developer at Vocdoni, an e-voting project built on open source technologies including Ethereum, zk-SNARKs and IPFS.
The opinion of BeInCrypto staff in a single voice.
Chinese Banks Suspend New Gold Trading Accounts Creation Amid Price Slump
Commercial banks in China are suspending the creation of new gold and precious metal trading accounts amid massive volatility in the market. Positive coronavirus vaccine trial news has seen a pivot from haven assets to riskier investment instruments causing a significant decline in precious metal prices. Chinese Banks Wary of Gold Price Volatility According to … Continued
Commercial banks in China are suspending the creation of new gold and precious metal trading accounts amid massive volatility in the market.
Positive coronavirus vaccine trial news has seen a pivot from haven assets to riskier investment instruments causing a significant decline in precious metal prices.
Chinese Banks Wary of Gold Price Volatility
According to a Reuters report on Nov. 27, major Chinese banks are suspending the opening of new gold trading accounts beginning from Saturday (Nov. 30). The suspension reportedly covers both over-the-counter and mobile banking channels.
Earlier in November, some banks in the country issued warnings about impending restrictions on forex and precious metals. At the time, palpable concerns raged about the possibility of the US election fallout causing significant disruptions in the global market.
In a statement on its website, the Industrial and Commercial Bank of China declared:
Affected by the global epidemic situation and the international political and economic situation, international and domestic precious metals price continued to show volatility, market risks, and uncertainties increased.
Friday’s announcement does not affect customers with existing gold trading accounts. However, the banks are warning investors to be wary of the current volatility in the market.
The gold price has been on the decline since the start of November, dipping by more than 8%. As of press time, gold futures are down to their lowest level in over five months with spot price dropping below the $1,800 price mark.
Back in early August, gold reached an all-time high (ATH) price of $2,060 per ounce. However, good news on coronavirus vaccines dampened investor optimism in haven assets triggering a significant price tumble.
Like gold, Bitcoin (BTC) is also experiencing price struggles after failing to break its ATH earlier in November. The largest crypto by market capitalization has seen over $3,000 shaved off its 2020 price high.
As previously reported by BeInCrypto, BTC is hunting for a support level following multiple rejections at the $17,500 price band.
Osato is a reporter at BeInCrypto and Bitcoin believer based in Lagos, Nigeria. When not immersed in the daily happenings in the crypto scene, he can be found watching historical documentaries or trying to beat his Scrabble high score.
NANO Rejected but Could Attempt Another Breakout Soon
Despite the sharp drop, the price already found support and is expected to soon create a higher low and begin moving towards the resistance levels outlined in the article. Long-Term Breakout The NANO price followed a descending resistance line from May 2019 until recently. On Nov 21 the price began an upward move and broke … Continued
The Nano (NANO) price broke out from a long-term resistance line on Nov. 24. The price was rejected shortly afterwards and has been decreasing since.
Despite the sharp drop, the price already found support and is expected to soon create a higher low and begin moving towards the resistance levels outlined in the article.
The NANO price followed a descending resistance line from May 2019 until recently. On Nov 21 the price began an upward move and broke out above this line three days later, reaching a high of $1.51.
However, the price was rejected at the $1.45 resistance area. A long upper wick appeared and the price fell back below the descending resistance line. It is possible that NANO now follows an ascending support line (dashed), which in turn would create a symmetrical triangle pattern. However, the line has not been validated a sufficient number of times.
Technical indicators are ambiguous, and fail to give a clear indication of the trend. While the MACD & RSI are increasing, the Stochastic Oscillator has made a bearish cross.
If the price breaks out, the next resistance area would be found at $2.05, the top of the descending resistance line and 0.5 Fib retracement level of the most recent decrease.
Cryptocurrency trader @GolrishBeck tweeted a NANO chart, which shows that the price has broken out from a long-term descending resistance line. While that was true in the beginning of the week, the decrease that transpired on Nov 26 put the breakout in doubt by creating the aforementioned long upper wick.
Re-Test Of The Breakout Level
The daily time-frame shows that despite the drop, the price has returned and validated the breakout level at $0.96 as support by creating a long lower wick. The level is also the 0.618 Fib retracement of the entire upward move, increasing its significance.
Furthermore, technical indicators are bullish, and the daily RSI has generated hidden bullish divergence. This suggests that the price will move upwards and possibly make another attempt at breaking out.
The shorter-term chart shows that the price already made an attempt at moving upwards but was rejected by the 0.5 Fib retracement level and has decreased.
In order for the trend to be considered bullish, NANO has to clear the 0.5-0.618 Fib resistance between $1.20-$1.26, or create a higher low and some type of bullish structure.
Short-term indicators support this possibility since both the RSI & MACD are increasing.
Since the aforementioned Nov 24 high, the price seems to have completed an A-B-C downward structure (orange). The move transpired in three waves instead of five, so the NANO price has not begun a new bearish impulse (period highlighted in red).
Therefore, what will follow now is either a new bullish impulse or a corrective B wave (white). At the time of writing, there is not enough information to determine which will occur.
However, since the decrease transpired in three waves, the ensuing move would be expected to reach the 0.9 Fib level of the decrease even if it is not the beginning of a new impulse. This would take the NANO price back towards $1.45.
Until the structure starts to develop, we cannot determine if it is a new bullish impulse.
To conclude, if it has not already done so, the NANO price is expected to soon reach a bottom. Then, it will begin to move upwards towards the $1.45 resistance area and possibly higher.
Disclaimer: Cryptocurrency trading carries a high level of risk and may not be suitable for all investors. The views expressed in this article do not reflect those of BeInCrypto
Valdrin is a cryptocurrency enthusiast and financial trader. After obtaining a masters degree in Financial Markets at the Barcelona Graduate School of Economics he began working at the Ministry of Economic Development in his native country of Kosovo.
In 2019, he decided to focus full-time on cryptocurrencies and trading.