diff --git a/solidity/contracts/bridge/WalletProposalValidator.sol b/solidity/contracts/bridge/WalletProposalValidator.sol
index 4a0dddb3d..5095094f0 100644
--- a/solidity/contracts/bridge/WalletProposalValidator.sol
+++ b/solidity/contracts/bridge/WalletProposalValidator.sol
@@ -94,6 +94,16 @@ contract WalletProposalValidator {
         uint256 redemptionTxFee;
     }
 
+    /// @notice Helper structure representing a moving funds proposal.
+    struct MovingFundsProposal {
+        // 20-byte public key hash of the source wallet.
+        bytes20 walletPubKeyHash;
+        // List of 20-byte public key hashes of target wallets.
+        bytes20[] targetWallets;
+        // Proposed BTC fee for the entire transaction.
+        uint256 movingFundsTxFee;
+    }
+
     /// @notice Helper structure representing a heartbeat proposal.
     struct HeartbeatProposal {
         // 20-byte public key hash of the target wallet.
@@ -587,6 +597,124 @@ contract WalletProposalValidator {
         return true;
     }
 
+    function validateMovingFundsProposal(
+        MovingFundsProposal calldata proposal,
+        BitcoinTx.UTXO calldata walletMainUtxo
+    ) external view returns (bool) {
+        Wallets.Wallet memory sourceWallet = bridge.wallets(
+            proposal.walletPubKeyHash
+        );
+
+        // Make sure the source wallet is eligible for moving funds.
+        require(
+            sourceWallet.state == Wallets.WalletState.MovingFunds,
+            "Source wallet is not in MovingFunds state"
+        );
+
+        require(
+            sourceWallet.pendingRedemptionsValue == 0,
+            "Source wallet has pending redemptions"
+        );
+
+        require(
+            sourceWallet.pendingMovedFundsSweepRequestsCount == 0,
+            "Source wallet has pending moved funds sweep requests"
+        );
+
+        // Make sure the number of target wallets is correct.
+        uint64 sourceWalletBtcBalance = getWalletBtcBalance(
+            sourceWallet.mainUtxoHash,
+            walletMainUtxo
+        );
+
+        require(
+            sourceWalletBtcBalance > 0,
+            "Source wallet BTC balance is zero"
+        );
+
+        uint32 liveWalletsCount = bridge.liveWalletsCount();
+
+        (, , , , , uint64 walletMaxBtcTransfer, ) = bridge.walletParameters();
+
+        uint256 expectedTargetWalletsCount = Math.min(
+            liveWalletsCount,
+            Math.ceilDiv(sourceWalletBtcBalance, walletMaxBtcTransfer)
+        );
+
+        require(expectedTargetWalletsCount > 0, "No target wallets available");
+
+        require(
+            proposal.targetWallets.length == expectedTargetWalletsCount,
+            "Submitted target wallets count is other than expected"
+        );
+
+        // Make sure the target wallets are Live and are ordered correctly.
+        uint160 lastProcessedTargetWallet = 0;
+
+        for (uint256 i = 0; i < proposal.targetWallets.length; i++) {
+            bytes20 targetWallet = proposal.targetWallets[i];
+
+            require(
+                targetWallet != proposal.walletPubKeyHash,
+                "Target wallet is equal to source wallet"
+            );
+
+            require(
+                uint160(targetWallet) > lastProcessedTargetWallet,
+                "Target wallet order is incorrect"
+            );
+
+            // slither-disable-next-line calls-loop
+            require(
+                bridge.wallets(targetWallet).state == Wallets.WalletState.Live,
+                "Target wallet is not in Live state"
+            );
+
+            lastProcessedTargetWallet = uint160(targetWallet);
+        }
+
+        // Make sure the proposed fee does not exceed the total fee limit.
+        (uint64 movingFundsTxMaxTotalFee, , , , , , , , , , ) = bridge
+            .movingFundsParameters();
+
+        require(
+            proposal.movingFundsTxFee > 0,
+            "Proposed transaction fee cannot be zero"
+        );
+
+        require(
+            proposal.movingFundsTxFee <= movingFundsTxMaxTotalFee,
+            "Proposed transaction fee is too high"
+        );
+
+        return true;
+    }
+
+    function getWalletBtcBalance(
+        bytes32 walletMainUtxoHash,
+        BitcoinTx.UTXO calldata walletMainUtxo
+    ) internal view returns (uint64 walletBtcBalance) {
+        // If the wallet has a main UTXO hash set, cross-check it with the
+        // provided plain-text parameter and get the transaction output value
+        // as BTC balance. Otherwise, the BTC balance is just zero.
+        if (walletMainUtxoHash != bytes32(0)) {
+            require(
+                keccak256(
+                    abi.encodePacked(
+                        walletMainUtxo.txHash,
+                        walletMainUtxo.txOutputIndex,
+                        walletMainUtxo.txOutputValue
+                    )
+                ) == walletMainUtxoHash,
+                "Invalid wallet main UTXO data"
+            );
+
+            walletBtcBalance = walletMainUtxo.txOutputValue;
+        }
+
+        return walletBtcBalance;
+    }
+
     /// @notice View function encapsulating the main rules of a valid heartbeat
     ///         proposal. This function is meant to facilitate the off-chain
     ///         validation of the incoming proposals. Thanks to it, most
diff --git a/solidity/test/bridge/WalletProposalValidator.test.ts b/solidity/test/bridge/WalletProposalValidator.test.ts
index 8755e057d..6c1fbf3e0 100644
--- a/solidity/test/bridge/WalletProposalValidator.test.ts
+++ b/solidity/test/bridge/WalletProposalValidator.test.ts
@@ -1894,6 +1894,91 @@ describe("WalletProposalValidator", () => {
     })
   })
 
+  describe("validateMovingFundsProposal", () => {
+    const walletPubKeyHash = "0x7ac2d9378a1c47e589dfb8095ca95ed2140d2726"
+    const ecdsaWalletID =
+      "0x4ad6b3ccbca81645865d8d0d575797a15528e98ced22f29a6f906d3259569863"
+
+    before(async () => {
+      await createSnapshot()
+
+      // TODO: Fill with appropriate parameters.
+      bridge.movingFundsParameters.returns([0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0])
+    })
+
+    after(async () => {
+      bridge.movingFundsParameters.reset()
+
+      await restoreSnapshot()
+    })
+
+    context("when wallet's state is not MovingFunds", () => {
+      const testData = [
+        {
+          testName: "when wallet state is Unknown",
+          walletState: walletState.Unknown,
+        },
+        {
+          testName: "when wallet state is Live",
+          walletState: walletState.Live,
+        },
+        {
+          testName: "when wallet state is Closing",
+          walletState: walletState.Closing,
+        },
+        {
+          testName: "when wallet state is Closed",
+          walletState: walletState.Closed,
+        },
+        {
+          testName: "when wallet state is Terminated",
+          walletState: walletState.Terminated,
+        },
+      ]
+
+      testData.forEach((test) => {
+        context(test.testName, () => {
+          before(async () => {
+            await createSnapshot()
+
+            bridge.wallets.whenCalledWith(walletPubKeyHash).returns({
+              ecdsaWalletID,
+              mainUtxoHash: HashZero,
+              pendingRedemptionsValue: 0,
+              createdAt: 0,
+              movingFundsRequestedAt: 0,
+              closingStartedAt: 0,
+              pendingMovedFundsSweepRequestsCount: 0,
+              state: test.walletState,
+              movingFundsTargetWalletsCommitmentHash: HashZero,
+            })
+          })
+
+          after(async () => {
+            bridge.wallets.reset()
+
+            await restoreSnapshot()
+          })
+
+          it("should revert", async () => {
+            await expect(
+              // Only walletPubKeyHash argument is relevant in this scenario.
+              walletProposalValidator.validateMovingFundsProposal({
+                walletPubKeyHash,
+                movingFundsTxFee: 0,
+                targetWallets: [],
+              })
+            ).to.be.revertedWith("Source wallet is not in MovingFunds state")
+          })
+        })
+      })
+    })
+
+    context("when wallet's state is MovingFunds", () => {
+      // TODO: Implement
+    })
+  })
+
   describe("validateHeartbeatProposal", () => {
     context("when message is not valid", () => {
       it("should revert", async () => {