Blockchain and Real Estate Investment: Designing an Indonesian Ecosystem

Abstract— The real estate investment market in Indonesia has lagged compared to other countries. The Real Estate Investment Fund (DIRE) which was introduced in 2007 has failed to develop. In contrast to Real Estate Investment Trusts (REITs) in developed economies which are more liquid and widely adopted. DIRE has main obstacles include high transfer fees, income taxes, fragmented governance, and asset owners’ reluctance to relinquish property rights. Current investment channels in Indonesia remain limited to direct purchases and debt financing through banks or bonds, both of which face structural barriers such as high interest rates, costly issuance processes, strict reporting requirements, and limited accessibility for smaller firms. This study adopts a Thematic Analysis (TA) for analysing qualitative data to develop a conceptual framework for a blockchain-based real estate issuance model aligned with Indonesia’s regulatory environment. TA has advantages due to its flexibility across theoretical framework, accessibility and ease of use, allows to focus on patterns of meaning, uncover assumptions or social processes. Data were collected through literature analysis, regulatory review, and expert interviews, complemented by comparative examination of international tokenization initiatives such as RealT, Blockimmo, Lofty, and Securitize. Findings indicate that a hybrid compliance model—combining off-chain mechanisms such as legal contracts, notarial verification, escrow management, and Special Purpose Vehicles (SPVs) with on-chain elements including tokenization, smart-contract validation, and immutable audit logging—can support the secure and legally aligned issuance of property-backed digital instruments. The proposed framework preserves asset ownership while enabling digital representation of economic rights, offering a structured pathway for controlled regulatory experimentation. The study contributes theoretically by extending blockchain governance literature, practically by providing insights for regulators, and strategically by offering industry stakeholders an alternative model for compliant and transparent real-estate financing.