The climate crisis is a crisis of water, better said of water usage.
Imagine water usage in the case of agriculture is managed by smart contracts. Now imagine the usage of water is recorded on a blockchain represented as NFTs.
This is a very powerful use of NFTs, and a perfect example of how NFTs can be used for far more than certificates of ownership to artworks or collectibles.
In this case, Rootstock (RSK), WakeUp Labs and Kilimo have shown that NFTs can also be certificates of sustainability.
What does this mean?
Companies can record their grade of efficiency in regards to using resources, in this case water, in certificates. This certificate is recorded by smart contracts and by creating a NFT on a blockchain. In the process, NFTs can therefore be used to improve the climate.
It is about helping companies to achieve water neutrality and at the same time to market water neutrality.
WakeUp is part of RSK and offers a range of smart contracts and APIs to provide NFTs functionality.
Through WakeUp, businesses and developers can introduce new functionality that removes all the overhead of interacting with complex protocols.
Kilimo's technology enables farmers to earn income for water conservation while allowing businesses to offset their water footprint.
Here's how that could work:
Let's imagine the annual water consumption in agriculture is limited and regulated. If I, as a farmer, manage to keep my water consumption efficient and below the limit, I receive a certificate for this circumstance. The consumption is recorded and measured by Internet of Things (IoT) devices which digitally transfer the corresponding results to smart contracts in the web. The smart contract then issues a certificate to me. Now I can sell this certificate to a farmer who uses more water than the limit. When one uses less, the other can buy, but the ecosystem remains within its limit. We both can balance together our usage according to the regulated value.
This is a good idea to use consumption in a more controlled and efficient way.
Now comes the good part.
The whole thing is a system that connects as Layer2 with a bridge to Bitcoin.
RSK/WakeUp offers a protocol that enables certification via smart contracts. Bitcoin integrates the execution into the Proof-of-Work (PoW) process used for mining. This PoW is used to secure the execution or verification of the contract. This in turn means that the energy needed to mine Bitcoin is simultaneously used to verify the smart contract and NFT for water neutrality certification. More energy is not needed, but the energy consumption of Bitcoin mining is used more efficiently. This is really a tremendous value. Imagine that in the future the energy consumption of Bitcoin is not only used for mining, but in parallel for the verification of smart contracts, that is already a great extension and a good increase in efficiency.
I am very curious to see what else is possible with RSK. I will follow it.
If you want to know more, feel free to contact me via kamis<at>blockchainintitute.com