diff --git a/app/process_proposal.go b/app/process_proposal.go
index 7b51634c80..fa9e444b00 100644
--- a/app/process_proposal.go
+++ b/app/process_proposal.go
@@ -68,6 +68,11 @@ func (app *App) ProcessProposal(req abci.RequestProcessProposal) (resp abci.Resp
 		}
 
 		sdkTx, err := app.txConfig.TxDecoder()(tx)
+		// Set the tx bytes in the context for app version v3 and greater
+		if sdkCtx.BlockHeader().Version.App >= 3 {
+			sdkCtx = sdkCtx.WithTxBytes(tx)
+		}
+
 		if err != nil {
 			if req.Header.Version.App == v1 {
 				// For appVersion 1, there was no block validity rule that all
@@ -90,9 +95,6 @@ func (app *App) ProcessProposal(req abci.RequestProcessProposal) (resp abci.Resp
 				return reject()
 			}
 
-			// Set the tx size on the context before calling the AnteHandler
-			sdkCtx = sdkCtx.WithTxBytes(tx)
-
 			// we need to increment the sequence for every transaction so that
 			// the signature check below is accurate. this error only gets hit
 			// if the account in question doesn't exist.
@@ -118,11 +120,6 @@ func (app *App) ProcessProposal(req abci.RequestProcessProposal) (resp abci.Resp
 			return reject()
 		}
 
-		// set the tx bytes in the context for app version v3 and greater
-		if sdkCtx.BlockHeader().Version.App >= 3 {
-			sdkCtx = sdkCtx.WithTxBytes(tx)
-		}
-
 		// validated the PFB signature
 		sdkCtx, err = handler(sdkCtx, sdkTx, false)
 		if err != nil {