Blockchain Technology Will Transform Water Access and Management Globally

Disclosure: The views and opinions expressed here are solely those of the author and do not represent the views and opinions of the crypto.news editorial team.

Access to clean water is a basic human need, yet billions of people around the world still struggle to get it. According to the World Health Organization, over 2 billion people live in countries suffering from severe water stress, and this number is expected to continue to grow due to climate change and population growth.

Traditional water management systems have struggled to address these challenges, often hampered by inefficiencies, lack of transparency, and misallocation of resources. Blockchain technology offers a promising solution to these challenges, providing equitable access and sustainable use of this crucial resource.

The current state of water management

Water management today faces several pressing issues. Inefficiencies in water supply, distribution, and use, coupled with a lack of real-time monitoring, often result in resource waste and misallocation. Many water sources fail to realize their full potential due to infrastructure and financing shortfalls. For example, the Environmental Protection Agency (EPA) report indicated that the United States would need to invest $625 billion over the next 20 years to repair, maintain and improve the country’s drinking water infrastructure due to aging pipes and other infrastructure problems. Additionally, in the United States alone, household leaks can to waste nearly 900 billion gallons of water per year nationwide. This is equivalent to the annual domestic water consumption of nearly 11 million homes.

Furthermore, corruption and mismanagement of water resources can cause unequal distribution, with disadvantaged communities often bearing the brunt of water scarcity. For example, South Africa is struggling with myriad challenges to its water security: drought, inadequate water conservation measures, outdated infrastructure, and unequal access to water resources. The country faces significant water scarcity, with demand expected to outstrip supply by 2030, creating a projected gap of 17%.

Furthermore, the global water industry is highly monopolized, with a few key players controlling a significant share of the market. These companies exert substantial influence over the water supply chain, often prioritizing profit over equitable distribution and environmental responsibility. This concentration of power can lead to inflated prices and limited access for vulnerable populations. The global bottled water market alone is projected to reach $509.18 billion by 2030, with these large companies capturing a significant share of revenue. This monopolization exacerbates existing inequalities in water access and highlights the need for more decentralized and community-driven water management solutions.

Source: Grand View Search

The potential of blockchain in water management

Blockchain technology can address these issues by providing a transparent, secure, and decentralized platform for water resource management. This approach offers several advantages:

• Transparency and accountability. Blockchain’s immutable ledger ensures that all transactions and data entries are transparent and cannot be changed once recorded. This transparency can reduce corruption and ensure that water resources are allocated fairly and efficiently. For example, blockchain can be used to track water usage from source to end user, providing a clear record of how water is distributed and used. This level of transparency can help hold authorities accountable and manage water resources sustainably.
• Efficient resource management. Blockchain can facilitate the creation of smart contracts, which are self-executing contracts with the terms of the agreement written directly into the code. These contracts can automate water distribution based on real-time data, directing water to where it is needed most. For example, smart contracts could be used to manage urban water supply systems, automatically adjusting water distribution based on real-time consumption patterns and demand. This can help optimize water use, reduce waste, and ensure that households and businesses receive the right amount of water at the right time.

In Dubai, the Dubai Electricity and Water Authority (DEWA) has implemented a blockchain-based smart water network initiative as part of its broader smart city strategy. This project integrates blockchain technology with IoT sensors to monitor water usage in real time, manage distribution, and detect leaks. The decentralized ledger ensures data integrity and transparency, enabling more efficient water management and reduced waste. DEWA’s initiative aims to improve sustainability and resource management in the rapidly growing city, highlighting the potential of blockchain to support urban water management and conservation efforts.

Community participation and ownership

Through blockchain, individuals can directly control and monetize their access to water resources, eliminating the need for third-party intermediaries. This direct control model allows local communities to make collective and transparent decisions about their water use. By managing their water directly from the source, communities can tailor water management practices to their specific needs, promoting equitable distribution and encouraging a sense of accountability and stewardship.

Additionally, future models could allow people to monetize their access to water through web3 technologies. For example, a community-to-business (C2B) model could allow people to sell water directly to companies. In this model, people do not have to own the water directly, but can profit by staking their tokens during event sales pools. This approach not only supports sustainable water management, but also creates economic opportunities for community members. Additionally, a “Burn to Secure” protocol can be used to provide water allocation rights. This protocol provides a true sense of water security and financial opportunity by allowing people to redeem their rights. This system not only secures future water allocations, but also increases token scarcity and value.

Additionally, a pure sense of investment is achieved through investments in water sources. This leads to potential financial returns and dividends by addressing the inefficiencies in water supply mentioned above. By investing to finance infrastructure projects, such as building factories and improving distribution systems, more water can be brought to communities, creating additional economic opportunities.

Monetizing water access through the C2B model, the “Burn to Secure” protocol, and investments in water sources all generate economic benefits for the community, promoting a more equitable and efficient water management system.

Overcoming challenges

While blockchain technology has the potential to improve water management, there are challenges to its adoption. The complexity of blockchain systems and the need for technological infrastructure can be barriers, especially in developing regions. Additionally, there are concerns about the significant energy consumption of blockchain networks. However, technological advances and the development of more energy-efficient blockchain solutions are helping to alleviate these concerns. Additionally, education and capacity building are key to ensuring stakeholders understand how to effectively use blockchain technology. Governments, NGOs, and private sector partners need to work together to provide training and support to communities and water management authorities.

Blockchain technology offers a practical and effective means to improve water management. In addition to addressing inefficiencies, blockchain empowers communities, promotes sustainable practices, and opens up new economic opportunities through models like community-to-business (C2B). As we face the growing challenges of climate change and population growth, blockchain is not only an innovative solution, but represents a fundamental shift in the way we manage and value water resources. Adopting blockchain in water management is essential to creating a sustainable and equitable future by changing the way we interact with and protect our most vital resource.

Jean-Hugues Gavarini

Jean-Hugues Gavarini is the CEO and co-founder of LAKE (LAK3), a real-world asset company leveraging blockchain technology to decentralize access to the global water economy. LAKE aims to ensure access to clean water for all, protect water resources, and deliver water to those in need through innovative technologies. Jean-Hugues has a diverse career spanning the luxury, fashion, and footwear industries. His career path includes notable successes at Mellow Yellow, Cremieux, and Tod’s. Raised between Silicon Valley and the French Alps, Jean-Hugues has always been immersed in technology and freshwater resources. In 2018, Jean became the CEO of Lanikea Waters, a water solutions entity based in the French Alps. In 2019, the concept of LAKE was born, embodying his commitment to innovation and sustainability.

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