AquaDoneRite

Digital Water Rights Ledger System
A Blockchain-Based Platform for Colorado Water Rights Administration Under the Prior Appropriation Doctrine

White Paper Version 1.0

January 2026

Smart Contract Version: v14

Table of Contents

  1. Executive Summary 3
  2. The Problem 4
  3. Colorado Water Law Background 6
  4. The AquaDoneRite Solution 8
  5. Technical Architecture 10
  6. Smart Contract System 12
  7. Use Cases 16
  8. Security & Compliance 19
  9. Technology Stack 21
  10. Roadmap 22
  11. Conclusion 23

1. Executive Summary

AquaDoneRite is a blockchain-based digital ledger system designed specifically for the administration of water rights under Colorado's Prior Appropriation doctrine. By representing water shares as Non-Fungible Tokens (NFTs) on a private Avalanche subnet, AquaDoneRite transforms the management of water rights from paper-based ledgers to cryptographically secured digital records.

The platform addresses critical challenges facing ditch companies, municipalities, and water administrators:

Record Integrity

Replace vulnerable paper ledgers with immutable blockchain records that cannot be altered or lost.

Transparent Ownership

Instant verification of water share ownership and complete chain of title.

Fractional Management

Automated tracking of subdivided water interests through unlimited generations.

Unified Administration

Consolidated billing, usage, and collection data across consecutive water systems.

Key Innovation

AquaDoneRite preserves the legal framework of Colorado water law while bringing 21st-century technology to an industry still operating on 19th-century infrastructure. The platform does not change how water rights work—it changes how they are recorded, tracked, and verified.

2. The Problem

The Current State of Water Rights Administration

Colorado's water rights system, established in the 1850s, predates modern record-keeping technology. Today, many ditch companies still maintain their official records in leather-bound ledgers—the same format used when these organizations were founded over a century ago.

This presents several critical challenges:

Fragmented Records

Opacity and Access

Fractional Complexity

Consecutive System Blindness

Legal Vulnerability

3. Colorado Water Law Background

The Prior Appropriation Doctrine

Colorado operates under the Prior Appropriation doctrine, summarized as "first in time, first in right." Unlike the Riparian rights system used in eastern states (where water rights attach to land ownership adjacent to water sources), Prior Appropriation allocates water based on the date water was first put to beneficial use.

Key Principles of Prior Appropriation

Priority Date: The date water was first diverted and applied to beneficial use establishes seniority. During shortages, senior rights (older dates) are fulfilled before junior rights can divert.

Beneficial Use: Water must be put to a recognized productive purpose—agricultural irrigation, municipal supply, domestic use, or industrial application. The right to use water does not include the right to waste it.

Adjudication: Water rights are decreed through the water court system, establishing the legal parameters of each right including priority date, amount, source, point of diversion, and type of use.

Abandonment: A water right may be lost through non-use. Colorado law creates a rebuttable presumption of abandonment after 10 years of non-use (C.R.S. 37-92-402).

Transferability: Unlike Riparian rights, appropriative water rights can be bought, sold, and transferred separate from land ownership, subject to water court approval.

The Ditch Company Model

Most agricultural water in Colorado is delivered through mutual ditch companies—cooperative organizations formed by farmers to construct and maintain irrigation infrastructure. Shareholders own "shares" representing a proportional interest in the water delivered through the ditch system.

Key characteristics of ditch company shares:

Consecutive Water Systems

Many municipalities and water districts receive their supply through "consecutive" systems—downstream infrastructure that draws from upstream sources. For example, a town might hold shares in a ditch company, then distribute that water through its own municipal system to dozens of connected subdivisions, businesses, and institutions.

This creates administrative complexity as water flows through multiple organizational boundaries, each with its own billing, metering, and record-keeping requirements.

4. The AquaDoneRite Solution

From Leather Ledgers to Digital Certainty

AquaDoneRite digitizes water rights administration while preserving the legal framework that has governed Colorado water for over 150 years. The platform does not change how water rights work—it changes how they are recorded, tracked, and verified.

Core Capabilities

NFT-Based Share Certificates

Each water share becomes a unique Non-Fungible Token with complete provenance from original adjudication to current holder.

Intelligent Subdivision

Parent shares subdivide into fractional children with enforced unit conservation and unlimited generation tracking.

Consecutive System Integration

Track water from source ditch through all downstream systems with unified visibility.

Billing & Collection Hub

Aggregate usage, assessments, and payments across all connected entities.

Water Share Token Attributes

Each NFT captures the complete legal and operational attributes of a water right:

Attribute Category Data Elements
Decree Information Case number, adjudication date, priority date, water division (1-7)
Ownership Ditch company ID, share units, current holder address
Point of Diversion Structure ID, GPS coordinates, source water body
Beneficial Use Use type (irrigation, municipal, domestic, industrial), place of use
Status Active, Suspended, Subdivided, Abandoned, In Adjudication
History Complete transfer history, usage records, subdivision lineage

5. Technical Architecture

Platform Overview

AquaDoneRite operates on a private Avalanche subnet, providing the security and immutability of blockchain technology within a controlled environment suitable for legal records.

AquaDoneRite Platform Architecture
👨‍🌾
Web App
Shareholders
📱
Mobile App
Operators
⚙️
Admin API
Billing Systems
Cloudflare Workers API Layer
Authentication · Authorization · Rate Limiting · Caching
Private Avalanche Subnet
WaterShareNFT
ERC-721 Tokens
DitchCompanyReg
Company Registry
ConsecSystemReg
System Hierarchy
BillingAndUsage
Accounts & Invoices

Why Avalanche?

Avalanche was selected for its unique combination of features suitable for enterprise water rights administration:

6. Smart Contract System

AquaDoneRite consists of four interconnected smart contracts that implement the complete water rights administration lifecycle:

WaterShareNFT.sol

The core contract implementing ERC-721 NFTs with water rights-specific extensions.

Key Features

Water Right Attributes:

Share Subdivision:

Status Management:

StatusDescription
ACTIVENormal operations, transferable
SUSPENDEDTemporarily restricted by administrator
SUBDIVIDEDDivided into child tokens
ABANDONEDNon-use determination by water commissioner
IN_ADJUDICATIONPending water court action

DitchCompanyRegistry.sol

Registry of all ditch companies authorized to mint and manage water shares.

ConsecutiveSystemRegistry.sol

Tracks downstream water systems receiving supply from upstream sources.

BillingAndUsage.sol

Comprehensive billing, payment, and collection management.

Security Features

Built-In Protections

Scarcity Enforcement: Cannot mint more shares than a company's registered total units

Authorization Verification: Only authorized wallets can mint for specific ditch companies

Cross-Validation: Decree division must match company's registered water division

Reentrancy Guards: All state-changing functions protected against reentrancy attacks

7. Use Cases

Use Case 1: Municipal Water Share Management

Scenario: The Town of Paonia holds 1/8 share in the North Fork Ditch Company, which it must subdivide across multiple municipal obligations.

Workflow

  1. Initial Acquisition: Town purchases 1/8 share from private seller; NFT transferred to Town's wallet with sale documentation recorded
  2. Subdivision Planning: Administrator identifies allocations: Parks (1/32), Fire Dept (1/32), Pool (1/16), Reserve (1/32)
  3. Execution: System creates 4 child NFTs; parent marked SUBDIVIDED; each child assigned to appropriate department
  4. Ongoing Administration: Each department receives usage-based billing with unified reporting

Benefits

Use Case 2: Consecutive System Tracking

Scenario: Water flows from a ditch company through the Town's treatment plant to 24 consecutive water systems serving rural subdivisions.

Workflow

  1. System Registration: Each of 24 consecutive systems registered with parent/child relationships and operator assignments
  2. Daily Operations: Meter readers record deliveries; usage aggregated with real-time visibility
  3. Billing Cycle: Assessments calculated from usage; invoices generated; consolidated reporting
  4. Delinquency Management: Overdue accounts flagged across systems; coordinated collection

Use Case 3: Water Court Documentation

Scenario: A water right owner must prove beneficial use to defend against abandonment claim.

Benefits

8. Security & Compliance

Smart Contract Security

Protection Implementation
Access Control Role-based permissions using OpenZeppelin AccessControl (Admin, Registrar, Ditch Company, Water Commissioner, Billing Operator, Payment Processor)
Reentrancy Protection ReentrancyGuard on all state-changing functions; Checks-Effects-Interactions pattern
Data Integrity Scarcity enforcement; cross-validation; balance invariant monitoring
Audit Trail Every transaction emits indexed events; history queryable via The Graph indexer

Legal Compliance

9. Technology Stack

Layer Technology
Blockchain Avalanche Private Subnet, Solidity 0.8.20, OpenZeppelin 4.9.6
API Cloudflare Workers, D1 Database, KV Cache
Frontend React, TypeScript, Tailwind CSS
Development Hardhat, Hardhat Ignition, The Graph (indexing)

10. Roadmap

Phase 1: Foundation (Q1 2026)

Phase 2: Pilot Program (Q2 2026)

Phase 3: Production Launch (Q3 2026)

Phase 4: Expansion (Q4 2026+)

11. Conclusion

AquaDoneRite represents a fundamental modernization of water rights administration while preserving the legal principles that have governed Colorado water for over 150 years. By combining blockchain immutability with purpose-built smart contracts, the platform delivers:

For Ditch Companies

Digital transformation of legacy systems, reduced administrative burden, instant verification, automated billing.

For Municipalities

Unified view of holdings, transparent allocation, integrated consecutive system management.

For Shareholders

24/7 access, instant ownership verification, clear subdivision lineage, simplified transfers.

For Water Commissioners

Verified usage records, abandonment tracking, priority verification, immutable audit trail.

Our Mission

AquaDoneRite brings digital certainty to water rights administration—preserving the wisdom of Colorado's Prior Appropriation doctrine while delivering the transparency, efficiency, and reliability that modern water management demands.


AquaDoneRite

Digital Water Rights Ledger System

aquadonerite.com


This white paper is for informational purposes only and does not constitute legal advice regarding water rights.
Consult with a qualified water attorney for specific legal guidance.

Document Version 1.0 | January 2026 | Contract Version v19