diff --git a/core/blockchain/nullchain/mocks/mocks.go b/core/blockchain/nullchain/mocks/mocks.go
index 17b4a0999c8..3ac68ff99d3 100644
--- a/core/blockchain/nullchain/mocks/mocks.go
+++ b/core/blockchain/nullchain/mocks/mocks.go
@@ -132,3 +132,18 @@ func (mr *MockApplicationServiceMockRecorder) InitChain(arg0, arg1 interface{})
 	mr.mock.ctrl.T.Helper()
 	return mr.mock.ctrl.RecordCallWithMethodType(mr.mock, "InitChain", reflect.TypeOf((*MockApplicationService)(nil).InitChain), arg0, arg1)
 }
+
+// PrepareProposal mocks base method.
+func (m *MockApplicationService) PrepareProposal(arg0 context.Context, arg1 *types.RequestPrepareProposal) (*types.ResponsePrepareProposal, error) {
+	m.ctrl.T.Helper()
+	ret := m.ctrl.Call(m, "PrepareProposal", arg0, arg1)
+	ret0, _ := ret[0].(*types.ResponsePrepareProposal)
+	ret1, _ := ret[1].(error)
+	return ret0, ret1
+}
+
+// PrepareProposal indicates an expected call of PrepareProposal.
+func (mr *MockApplicationServiceMockRecorder) PrepareProposal(arg0, arg1 interface{}) *gomock.Call {
+	mr.mock.ctrl.T.Helper()
+	return mr.mock.ctrl.RecordCallWithMethodType(mr.mock, "PrepareProposal", reflect.TypeOf((*MockApplicationService)(nil).PrepareProposal), arg0, arg1)
+}
diff --git a/core/blockchain/nullchain/nullchain.go b/core/blockchain/nullchain/nullchain.go
index 9dda90a4d15..2e168470521 100644
--- a/core/blockchain/nullchain/nullchain.go
+++ b/core/blockchain/nullchain/nullchain.go
@@ -55,6 +55,7 @@ type TimeService interface {
 
 type ApplicationService interface {
 	InitChain(context.Context, *abci.RequestInitChain) (*abci.ResponseInitChain, error)
+	PrepareProposal(_ context.Context, req *abci.RequestPrepareProposal) (*abci.ResponsePrepareProposal, error)
 	FinalizeBlock(context.Context, *abci.RequestFinalizeBlock) (*abci.ResponseFinalizeBlock, error)
 	Commit(context.Context, *abci.RequestCommit) (*abci.ResponseCommit, error)
 	Info(context.Context, *abci.RequestInfo) (*abci.ResponseInfo, error)
@@ -187,22 +188,35 @@ func (n *NullBlockchain) processBlock() {
 		n.log.Debugf("processing block %d with %d transactions", n.blockHeight, len(n.pending))
 	}
 
+	// prepare it first
+	ctx := context.Background()
+	proposal, err := n.app.PrepareProposal(ctx,
+		&abci.RequestPrepareProposal{
+			Height: n.blockHeight,
+			Time:   n.now,
+			Txs:    n.pending,
+		})
+	if err != nil {
+		// core always returns nil so we are safe really
+		panic("nullchain cannot handle failure to prepare a proposal")
+	}
+
 	resp := &abci.ResponseFinalizeBlock{}
 	if n.replayer != nil && n.cfg.Replay.Record {
-		n.replayer.startBlock(n.blockHeight, n.now.UnixNano(), n.pending)
+		n.replayer.startBlock(n.blockHeight, n.now.UnixNano(), proposal.Txs)
 		defer func() {
 			n.replayer.saveBlock(resp.AppHash)
 		}()
 	}
 
-	resp, _ = n.app.FinalizeBlock(context.Background(), &abci.RequestFinalizeBlock{
+	resp, _ = n.app.FinalizeBlock(ctx, &abci.RequestFinalizeBlock{
 		Height: n.blockHeight,
 		Time:   n.now,
 		Hash:   vgcrypto.Hash([]byte(strconv.FormatInt(n.blockHeight+n.now.UnixNano(), 10))),
-		Txs:    n.pending,
+		Txs:    proposal.Txs,
 	})
 	n.pending = n.pending[:0]
-	n.app.Commit(context.Background(), &abci.RequestCommit{})
+	n.app.Commit(ctx, &abci.RequestCommit{})
 
 	// Increment time, blockheight, ready to start a new block
 	n.blockHeight++
diff --git a/core/blockchain/nullchain/nullchain_test.go b/core/blockchain/nullchain/nullchain_test.go
index 9588b309b84..9fa4a52b133 100644
--- a/core/blockchain/nullchain/nullchain_test.go
+++ b/core/blockchain/nullchain/nullchain_test.go
@@ -322,6 +322,15 @@ func getTestUnstartedNullChain(t *testing.T, txnPerBlock uint64, d time.Duration
 	n.SetABCIApp(app)
 	require.NotNil(t, n)
 
+	app.EXPECT().PrepareProposal(gomock.Any(), gomock.Any()).DoAndReturn(
+		func(_ context.Context, req *abci.RequestPrepareProposal) (*abci.ResponsePrepareProposal, error) {
+			ret := &abci.ResponsePrepareProposal{
+				Txs: req.Txs,
+			}
+			return ret, nil
+		},
+	).AnyTimes()
+
 	return &testNullBlockChain{
 		chain: n,
 		ctrl:  ctrl,
diff --git a/core/txcache/cache.go b/core/txcache/cache.go
index 05834c3ffaa..179e79e3fd7 100644
--- a/core/txcache/cache.go
+++ b/core/txcache/cache.go
@@ -33,6 +33,7 @@ func NewTxCache(commander *nodewallets.Commander) *TxCache {
 	return &TxCache{
 		commander:             commander,
 		marketToDelayRequired: map[string]bool{},
+		heightToTxs:           map[uint64][][]byte{},
 	}
 }