diff --git a/Makefile b/Makefile
index 1311e48f56..d4bcc97005 100644
--- a/Makefile
+++ b/Makefile
@@ -173,7 +173,6 @@ test-race:
 test-cover:
 	@go test -mod=readonly -timeout 30m -race -coverprofile=coverage.txt -covermode=atomic -tags='ledger test_ledger_mock' ./...
 
-
 benchmark:
 	@go test -mod=readonly -bench=. ./...
 
diff --git a/contrib/relayer-tests/.gitignore b/contrib/relayer-tests/.gitignore
new file mode 100644
index 0000000000..d369e35ff8
--- /dev/null
+++ b/contrib/relayer-tests/.gitignore
@@ -0,0 +1,3 @@
+# Testing
+.relayer
+data
diff --git a/contrib/relayer-tests/README.md b/contrib/relayer-tests/README.md
new file mode 100644
index 0000000000..317f830b91
--- /dev/null
+++ b/contrib/relayer-tests/README.md
@@ -0,0 +1,6 @@
+# Relayer tests
+
+The setup scripts here are taken from [cosmos/relayer](https://github.com/cosmos/relayer)
+Thank your relayer team for these scripts.
+
+
diff --git a/contrib/relayer-tests/RELAYER_TEST.md b/contrib/relayer-tests/RELAYER_TEST.md
new file mode 100644
index 0000000000..fbdd682499
--- /dev/null
+++ b/contrib/relayer-tests/RELAYER_TEST.md
@@ -0,0 +1,8 @@
+# Relayer tests
+
+These scripts helps to test go-relayer with two local wasmd chains. \
+Make sure you run below scripts under `wasmd/contrib/relayer-tests` directory.
+
+- `./init_two_chainz_relayer.sh` will spin two chains and runs
+- `./one_chain.sh` will spin a single chain. This script used by the one above
+-`./test_ibc_transfer.sh` will setup a path between chains and send tokens between chains.
diff --git a/contrib/relayer-tests/configs/wasmd/demo.json b/contrib/relayer-tests/configs/wasmd/demo.json
new file mode 100644
index 0000000000..26942c74d1
--- /dev/null
+++ b/contrib/relayer-tests/configs/wasmd/demo.json
@@ -0,0 +1 @@
+{"src":{"chain-id":"ibc-0","client-id":"","connection-id":"","channel-id":"","port-id":"transfer","order":"unordered","version":"ics20-1"},"dst":{"chain-id":"ibc-1","client-id":"","connection-id":"","channel-id":"","port-id":"transfer","order":"unordered","version":"ics20-1"},"strategy":{"type":"naive"}}
diff --git a/contrib/relayer-tests/configs/wasmd/ibc-0.json b/contrib/relayer-tests/configs/wasmd/ibc-0.json
new file mode 100644
index 0000000000..854f76492e
--- /dev/null
+++ b/contrib/relayer-tests/configs/wasmd/ibc-0.json
@@ -0,0 +1 @@
+{"key":"testkey","chain-id":"ibc-0","rpc-addr":"http://localhost:26657","account-prefix":"wasm","gas-adjustment":1.5,"gas-prices":"0.025stake","trusting-period":"336h"}
diff --git a/contrib/relayer-tests/configs/wasmd/ibc-1.json b/contrib/relayer-tests/configs/wasmd/ibc-1.json
new file mode 100644
index 0000000000..88696b6f3d
--- /dev/null
+++ b/contrib/relayer-tests/configs/wasmd/ibc-1.json
@@ -0,0 +1 @@
+{"key":"testkey","chain-id":"ibc-1","rpc-addr":"http://localhost:26557","account-prefix":"wasm","gas-adjustment":1.5,"gas-prices":"0.025stake", "trusting-period":"336h"}
diff --git a/contrib/relayer-tests/init_two_chainz_relayer.sh b/contrib/relayer-tests/init_two_chainz_relayer.sh
new file mode 100755
index 0000000000..bcedb7c862
--- /dev/null
+++ b/contrib/relayer-tests/init_two_chainz_relayer.sh
@@ -0,0 +1,63 @@
+#!/bin/bash
+# init_two_chainz_relayer creates two wasmd chains and configures the relayer
+
+SCRIPTDIR="$( cd "$( dirname "${BASH_SOURCE[0]}" )" >/dev/null 2>&1 && pwd )"
+WASMD_DATA="$(pwd)/data"
+RELAYER_CONF="$(pwd)/.relayer"
+
+# Ensure relayer is installed
+if ! [ -x "$(which rly)" ]; then
+  echo "Error: wasmd is not installed. Try running 'make build-wasmd'" >&2
+  exit 1
+fi
+
+# Ensure wasmd is installed
+if ! [ -x "$(which wasmd)" ]; then
+  echo "Error: wasmd is not installed. Try running 'make build-wasmd'" >&2
+  exit 1
+fi
+
+# Display software version for testers
+echo "WASMD VERSION INFO:"
+wasmd version --long
+
+# Ensure jq is installed
+if [[ ! -x "$(which jq)" ]]; then
+  echo "jq (a tool for parsing json in the command line) is required..."
+  echo "https://stedolan.github.io/jq/download/"
+  exit 1
+fi
+
+# Delete data from old runs
+rm -rf $WASMD_DATA &> /dev/null
+rm -rf $RELAYER_CONF &> /dev/null
+
+# Stop existing wasmd processes
+killall wasmd &> /dev/null
+
+set -e
+
+chainid0=ibc-0
+chainid1=ibc-1
+
+echo "Generating wasmd configurations..."
+mkdir -p $WASMD_DATA && cd $WASMD_DATA && cd ../
+./one_chain.sh wasmd $chainid0 ./data 26657 26656 6060 9090
+./one_chain.sh wasmd $chainid1 ./data 26557 26556 6061 9091
+
+[ -f $WASMD_DATA/$chainid0.log ] && echo "$chainid0 initialized. Watch file $WASMD_DATA/$chainid0.log to see its execution."
+[ -f $WASMD_DATA/$chainid1.log ] && echo "$chainid1 initialized. Watch file $WASMD_DATA/$chainid1.log to see its execution."
+
+
+echo "Generating rly configurations..."
+rly config init
+rly config add-dir configs/wasmd/
+
+SEED0=$(jq -r '.mnemonic' $WASMD_DATA/ibc-0/key_seed.json)
+SEED1=$(jq -r '.mnemonic' $WASMD_DATA/ibc-1/key_seed.json)
+echo "Key $(rly keys restore ibc-0 testkey "$SEED0") imported from ibc-0 to relayer..."
+echo "Key $(rly keys restore ibc-1 testkey "$SEED1") imported from ibc-1 to relayer..."
+echo "Creating light clients..."
+sleep 3
+rly light init ibc-0 -f
+rly light init ibc-1 -f
diff --git a/contrib/relayer-tests/one_chain.sh b/contrib/relayer-tests/one_chain.sh
new file mode 100755
index 0000000000..3e8ba5666a
--- /dev/null
+++ b/contrib/relayer-tests/one_chain.sh
@@ -0,0 +1,115 @@
+#!/bin/sh
+
+set -e
+
+display_usage() {
+	echo "\nMissing $1 parameter. Please check if all parameters were specified."
+	echo "\nUsage: ./one-chain [BINARY] [CHAIN_ID] [CHAIN_DIR] [RPC_PORT] [P2P_PORT] [PROFILING_PORT] [GRPC_PORT]"
+  echo "\nExample: ./one-chain $BINARY test-chain-id ./data 26657 26656 6060 9090 \n"
+  exit 1
+}
+
+KEYRING=--keyring-backend="test"
+SILENT=1
+
+redirect() {
+  if [ "$SILENT" -eq 1 ]; then
+    "$@" > /dev/null 2>&1
+  else
+    "$@"
+  fi
+}
+
+BINARY=$1
+CHAINID=$2
+CHAINDIR=$3
+RPCPORT=$4
+P2PPORT=$5
+PROFPORT=$6
+GRPCPORT=$7
+
+if [ -z "$1" ]; then
+  display_usage "[BINARY] ($BINARY|akash)"
+fi
+
+if [ -z "$2" ]; then
+  display_usage "[CHAIN_ID]"
+fi
+
+if [ -z "$3" ]; then
+  display_usage "[CHAIN_DIR]"
+fi
+
+if [ -z "$4" ]; then
+  display_usage "[RPC_PORT]"
+fi
+
+if [ -z "$5" ]; then
+  display_usage "[P2P_PORT]"
+fi
+
+if [ -z "$6" ]; then
+  display_usage "[PROFILING_PORT]"
+fi
+
+if [ -z "$7" ]; then
+  display_usage "[GRPC_PORT]"
+fi
+
+echo "Creating $BINARY instance: home=$CHAINDIR | chain-id=$CHAINID | p2p=:$P2PPORT | rpc=:$RPCPORT | profiling=:$PROFPORT | grpc=:$GRPCPORT"
+
+# Add dir for chain, exit if error
+if ! mkdir -p $CHAINDIR/$CHAINID 2>/dev/null; then
+    echo "Failed to create chain folder. Aborting..."
+    exit 1
+fi
+
+# Build genesis file incl account for passed address
+chain_one_coins="100000000000stake,100000000000umuon,100000000000test"
+chain_two_coins="100000000000stake,100000000000umuon"
+delegate="100000000000stake"
+
+redirect $BINARY --home $CHAINDIR/$CHAINID --chain-id $CHAINID init $CHAINID
+sleep 1
+$BINARY --home $CHAINDIR/$CHAINID keys add validator $KEYRING --output json > $CHAINDIR/$CHAINID/validator_seed.json 2> /dev/null
+sleep 1
+$BINARY --home $CHAINDIR/$CHAINID keys add user $KEYRING --output json > $CHAINDIR/$CHAINID/key_seed.json 2> /dev/null
+sleep 1
+redirect $BINARY --home $CHAINDIR/$CHAINID add-genesis-account $($BINARY --home $CHAINDIR/$CHAINID keys $KEYRING show user -a) $chain_one_coins
+sleep 1
+redirect $BINARY --home $CHAINDIR/$CHAINID add-genesis-account $($BINARY --home $CHAINDIR/$CHAINID keys $KEYRING show validator -a) $chain_two_coins
+sleep 1
+redirect $BINARY --home $CHAINDIR/$CHAINID gentx validator $delegate $KEYRING --chain-id $CHAINID
+sleep 1
+redirect $BINARY --home $CHAINDIR/$CHAINID collect-gentxs
+sleep 1
+
+# Check platform
+platform='unknown'
+unamestr=`uname`
+if [ "$unamestr" = 'Linux' ]; then
+   platform='linux'
+fi
+
+# Set proper defaults and change ports (use a different sed for Mac or Linux)
+echo "Change settings in config.toml file..."
+if [ $platform = 'linux' ]; then
+  sed -i 's#"tcp://127.0.0.1:26657"#"tcp://0.0.0.0:'"$RPCPORT"'"#g' $CHAINDIR/$CHAINID/config/config.toml
+  sed -i 's#"tcp://0.0.0.0:26656"#"tcp://0.0.0.0:'"$P2PPORT"'"#g' $CHAINDIR/$CHAINID/config/config.toml
+  sed -i 's#"localhost:6060"#"localhost:'"$P2PPORT"'"#g' $CHAINDIR/$CHAINID/config/config.toml
+  sed -i 's/timeout_commit = "5s"/timeout_commit = "1s"/g' $CHAINDIR/$CHAINID/config/config.toml
+  sed -i 's/timeout_propose = "3s"/timeout_propose = "1s"/g' $CHAINDIR/$CHAINID/config/config.toml
+  sed -i 's/index_all_keys = false/index_all_keys = true/g' $CHAINDIR/$CHAINID/config/config.toml
+  # sed -i '' 's#index-events = \[\]#index-events = \["message.action","send_packet.packet_src_channel","send_packet.packet_sequence"\]#g' $CHAINDIR/$CHAINID/config/app.toml
+else
+  sed -i '' 's#"tcp://127.0.0.1:26657"#"tcp://0.0.0.0:'"$RPCPORT"'"#g' $CHAINDIR/$CHAINID/config/config.toml
+  sed -i '' 's#"tcp://0.0.0.0:26656"#"tcp://0.0.0.0:'"$P2PPORT"'"#g' $CHAINDIR/$CHAINID/config/config.toml
+  sed -i '' 's#"localhost:6060"#"localhost:'"$P2PPORT"'"#g' $CHAINDIR/$CHAINID/config/config.toml
+  sed -i '' 's/timeout_commit = "5s"/timeout_commit = "1s"/g' $CHAINDIR/$CHAINID/config/config.toml
+  sed -i '' 's/timeout_propose = "3s"/timeout_propose = "1s"/g' $CHAINDIR/$CHAINID/config/config.toml
+  sed -i '' 's/index_all_keys = false/index_all_keys = true/g' $CHAINDIR/$CHAINID/config/config.toml
+  # sed -i '' 's#index-events = \[\]#index-events = \["message.action","send_packet.packet_src_channel","send_packet.packet_sequence"\]#g' $CHAINDIR/$CHAINID/config/app.toml
+fi
+
+# Start the gaia
+redirect $BINARY --home $CHAINDIR/$CHAINID start --pruning=nothing --grpc.address="0.0.0.0:$GRPCPORT" > $CHAINDIR/$CHAINID.log &
diff --git a/contrib/relayer-tests/test_ibc_transfer.sh b/contrib/relayer-tests/test_ibc_transfer.sh
new file mode 100755
index 0000000000..d00504cf1e
--- /dev/null
+++ b/contrib/relayer-tests/test_ibc_transfer.sh
@@ -0,0 +1,26 @@
+#!/bin/bash
+
+set -e
+
+# Ensure relayer is installed
+if ! [ -x "$(which rly)" ]; then
+  echo "Error: rly is not installed." >&2
+  exit 1
+fi
+
+rly tx link demo -d
+
+rly tx transfer ibc-0 ibc-1 1000000test $(rly chains address ibc-1)
+
+sleep 2
+
+EXPECTED_BALANCE="100000000000test"
+CHAIN_1_BALANCE=$(rly q bal ibc-1)
+
+if [[ "$CHAIN_1_BALANCE" == *"$EXPECTED_BALANCE" ]]; then
+    echo "Token not sent correctly"
+    echo "$EXPECTED_BALANCE not found in $CHAIN_1_BALANCE"
+    exit 1
+fi
+
+echo "IBC transfer executed successfully"