diff --git a/CHANGELOG.md b/CHANGELOG.md
index 437ae5355..54f791ac1 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -37,6 +37,11 @@ The format is based on [Keep a Changelog](https://keepachangelog.com/en/1.0.0/)
 
 ## Unreleased
 
+### Improvements
+
+* [#235](https://github.com/babylonlabs-io/babylon/pull/235) Change default values
+for iavl cache when using `testnet` command
+
 ## v0.14.1
 
 ### API Breaking
diff --git a/cmd/babylond/cmd/testnet.go b/cmd/babylond/cmd/testnet.go
index 22d880afc..bae46a5e6 100644
--- a/cmd/babylond/cmd/testnet.go
+++ b/cmd/babylond/cmd/testnet.go
@@ -197,6 +197,11 @@ func InitTestnet(
 	babylonConfig.GRPC.Enable = true
 	babylonConfig.GRPC.Address = "0.0.0.0:9090"
 
+	// Disable IAVL cache by default as Babylon leaf nodes can be large, and in case
+	// of big cache values, Babylon node can run out of memory.
+	babylonConfig.IAVLCacheSize = 0
+	babylonConfig.IAVLDisableFastNode = true
+
 	var (
 		genAccounts []authtypes.GenesisAccount
 		genBalances []banktypes.Balance