diff --git a/cmd/evm/main.go b/cmd/evm/main.go
index e170dc1907..64044c4214 100644
--- a/cmd/evm/main.go
+++ b/cmd/evm/main.go
@@ -113,7 +113,7 @@ func run(ctx *cli.Context) {
 	glog.SetV(ctx.GlobalInt(VerbosityFlag.Name))
 
 	db, _ := ethdb.NewMemDatabase()
-	statedb := state.New(common.Hash{}, db)
+	statedb, _ := state.New(common.Hash{}, db)
 	sender := statedb.CreateAccount(common.StringToAddress("sender"))
 	receiver := statedb.CreateAccount(common.StringToAddress("receiver"))
 	receiver.SetCode(common.Hex2Bytes(ctx.GlobalString(CodeFlag.Name)))
diff --git a/cmd/geth/blocktestcmd.go b/cmd/geth/blocktestcmd.go
index e0a5becdc0..e4d97aa531 100644
--- a/cmd/geth/blocktestcmd.go
+++ b/cmd/geth/blocktestcmd.go
@@ -101,7 +101,8 @@ func runBlockTest(ctx *cli.Context) {
 
 func runOneBlockTest(ctx *cli.Context, test *tests.BlockTest) (*eth.Ethereum, error) {
 	cfg := utils.MakeEthConfig(ClientIdentifier, Version, ctx)
-	cfg.NewDB = func(path string) (ethdb.Database, error) { return ethdb.NewMemDatabase() }
+	db, _ := ethdb.NewMemDatabase()
+	cfg.NewDB = func(path string) (ethdb.Database, error) { return db, nil }
 	cfg.MaxPeers = 0 // disable network
 	cfg.Shh = false  // disable whisper
 	cfg.NAT = nil    // disable port mapping
@@ -113,7 +114,7 @@ func runOneBlockTest(ctx *cli.Context, test *tests.BlockTest) (*eth.Ethereum, er
 	// import the genesis block
 	ethereum.ResetWithGenesisBlock(test.Genesis)
 	// import pre accounts
-	_, err = test.InsertPreState(ethereum)
+	_, err = test.InsertPreState(db, cfg.AccountManager)
 	if err != nil {
 		return ethereum, fmt.Errorf("InsertPreState: %v", err)
 	}
@@ -123,7 +124,10 @@ func runOneBlockTest(ctx *cli.Context, test *tests.BlockTest) (*eth.Ethereum, er
 	if err != nil {
 		return ethereum, fmt.Errorf("Block Test load error: %v", err)
 	}
-	newDB := cm.State()
+	newDB, err := cm.State()
+	if err != nil {
+		return ethereum, fmt.Errorf("Block Test get state error: %v", err)
+	}
 	if err := test.ValidatePostState(newDB); err != nil {
 		return ethereum, fmt.Errorf("post state validation failed: %v", err)
 	}
diff --git a/cmd/geth/chaincmd.go b/cmd/geth/chaincmd.go
index c5bc4b66ac..80f3777d6d 100644
--- a/cmd/geth/chaincmd.go
+++ b/cmd/geth/chaincmd.go
@@ -179,7 +179,11 @@ func dump(ctx *cli.Context) {
 			fmt.Println("{}")
 			utils.Fatalf("block not found")
 		} else {
-			state := state.New(block.Root(), chainDb)
+			state, err := state.New(block.Root(), chainDb)
+			if err != nil {
+				utils.Fatalf("could not create new state: %v", err)
+				return
+			}
 			fmt.Printf("%s\n", state.Dump())
 		}
 	}
diff --git a/core/block_processor.go b/core/block_processor.go
index 783e156876..a07d79bcf9 100644
--- a/core/block_processor.go
+++ b/core/block_processor.go
@@ -207,7 +207,10 @@ func (sm *BlockProcessor) Process(block *types.Block) (logs vm.Logs, receipts ty
 
 func (sm *BlockProcessor) processWithParent(block, parent *types.Block) (logs vm.Logs, receipts types.Receipts, err error) {
 	// Create a new state based on the parent's root (e.g., create copy)
-	state := state.New(parent.Root(), sm.chainDb)
+	state, err := state.New(parent.Root(), sm.chainDb)
+	if err != nil {
+		return nil, nil, err
+	}
 	header := block.Header()
 	uncles := block.Uncles()
 	txs := block.Transactions()
diff --git a/core/block_processor_test.go b/core/block_processor_test.go
index ba8bd7bcd5..e0e5607b9b 100644
--- a/core/block_processor_test.go
+++ b/core/block_processor_test.go
@@ -46,7 +46,7 @@ func TestNumber(t *testing.T) {
 	pow := ezp.New()
 	_, chain := proc()
 
-	statedb := state.New(chain.Genesis().Root(), chain.chainDb)
+	statedb, _ := state.New(chain.Genesis().Root(), chain.chainDb)
 	header := makeHeader(chain.Genesis(), statedb)
 	header.Number = big.NewInt(3)
 	err := ValidateHeader(pow, header, chain.Genesis().Header(), false, false)
diff --git a/core/blockchain.go b/core/blockchain.go
index 6c555e9eec..62a306265e 100644
--- a/core/blockchain.go
+++ b/core/blockchain.go
@@ -199,7 +199,7 @@ func (self *BlockChain) SetProcessor(proc types.BlockProcessor) {
 	self.processor = proc
 }
 
-func (self *BlockChain) State() *state.StateDB {
+func (self *BlockChain) State() (*state.StateDB, error) {
 	return state.New(self.CurrentBlock().Root(), self.chainDb)
 }
 
diff --git a/core/chain_makers.go b/core/chain_makers.go
index ba09b30290..4347d91733 100644
--- a/core/chain_makers.go
+++ b/core/chain_makers.go
@@ -156,7 +156,10 @@ func (b *BlockGen) OffsetTime(seconds int64) {
 // values. Inserting them into BlockChain requires use of FakePow or
 // a similar non-validating proof of work implementation.
 func GenerateChain(parent *types.Block, db ethdb.Database, n int, gen func(int, *BlockGen)) []*types.Block {
-	statedb := state.New(parent.Root(), db)
+	statedb, err := state.New(parent.Root(), db)
+	if err != nil {
+		panic(err)
+	}
 	blocks := make(types.Blocks, n)
 	genblock := func(i int, h *types.Header) *types.Block {
 		b := &BlockGen{parent: parent, i: i, chain: blocks, header: h, statedb: statedb}
diff --git a/core/chain_makers_test.go b/core/chain_makers_test.go
index b33af8d873..63825c2613 100644
--- a/core/chain_makers_test.go
+++ b/core/chain_makers_test.go
@@ -84,7 +84,7 @@ func ExampleGenerateChain() {
 		return
 	}
 
-	state := chainman.State()
+	state, _ := chainman.State()
 	fmt.Printf("last block: #%d\n", chainman.CurrentBlock().Number())
 	fmt.Println("balance of addr1:", state.GetBalance(addr1))
 	fmt.Println("balance of addr2:", state.GetBalance(addr2))
diff --git a/core/genesis.go b/core/genesis.go
index 4c5c17f601..16c1598c28 100644
--- a/core/genesis.go
+++ b/core/genesis.go
@@ -60,7 +60,8 @@ func WriteGenesisBlock(chainDb ethdb.Database, reader io.Reader) (*types.Block,
 		return nil, err
 	}
 
-	statedb := state.New(common.Hash{}, chainDb)
+	// creating with empty hash always works
+	statedb, _ := state.New(common.Hash{}, chainDb)
 	for addr, account := range genesis.Alloc {
 		address := common.HexToAddress(addr)
 		statedb.AddBalance(address, common.String2Big(account.Balance))
@@ -115,9 +116,9 @@ func WriteGenesisBlock(chainDb ethdb.Database, reader io.Reader) (*types.Block,
 }
 
 // GenesisBlockForTesting creates a block in which addr has the given wei balance.
-// The state trie of the block is written to db.
+// The state trie of the block is written to db. the passed db needs to contain a state root
 func GenesisBlockForTesting(db ethdb.Database, addr common.Address, balance *big.Int) *types.Block {
-	statedb := state.New(common.Hash{}, db)
+	statedb, _ := state.New(common.Hash{}, db)
 	obj := statedb.GetOrNewStateObject(addr)
 	obj.SetBalance(balance)
 	root, err := statedb.Commit()
diff --git a/core/state/managed_state_test.go b/core/state/managed_state_test.go
index 58e77d842b..0b53a42c54 100644
--- a/core/state/managed_state_test.go
+++ b/core/state/managed_state_test.go
@@ -27,7 +27,7 @@ var addr = common.BytesToAddress([]byte("test"))
 
 func create() (*ManagedState, *account) {
 	db, _ := ethdb.NewMemDatabase()
-	statedb := New(common.Hash{}, db)
+	statedb, _ := New(common.Hash{}, db)
 	ms := ManageState(statedb)
 	so := &StateObject{address: addr, nonce: 100}
 	ms.StateDB.stateObjects[addr.Str()] = so
diff --git a/core/state/state_test.go b/core/state/state_test.go
index b5a7f40811..08fbc47fa2 100644
--- a/core/state/state_test.go
+++ b/core/state/state_test.go
@@ -77,12 +77,12 @@ func (s *StateSuite) TestDump(c *checker.C) {
 
 func (s *StateSuite) SetUpTest(c *checker.C) {
 	db, _ := ethdb.NewMemDatabase()
-	s.state = New(common.Hash{}, db)
+	s.state, _ = New(common.Hash{}, db)
 }
 
 func TestNull(t *testing.T) {
 	db, _ := ethdb.NewMemDatabase()
-	state := New(common.Hash{}, db)
+	state, _ := New(common.Hash{}, db)
 
 	address := common.HexToAddress("0x823140710bf13990e4500136726d8b55")
 	state.CreateAccount(address)
@@ -122,7 +122,7 @@ func (s *StateSuite) TestSnapshot(c *checker.C) {
 // printing/logging in tests (-check.vv does not work)
 func TestSnapshot2(t *testing.T) {
 	db, _ := ethdb.NewMemDatabase()
-	state := New(common.Hash{}, db)
+	state, _ := New(common.Hash{}, db)
 
 	stateobjaddr0 := toAddr([]byte("so0"))
 	stateobjaddr1 := toAddr([]byte("so1"))
diff --git a/core/state/statedb.go b/core/state/statedb.go
index ad673aecba..a9de71409c 100644
--- a/core/state/statedb.go
+++ b/core/state/statedb.go
@@ -52,12 +52,11 @@ type StateDB struct {
 }
 
 // Create a new state from a given trie
-func New(root common.Hash, db ethdb.Database) *StateDB {
+func New(root common.Hash, db ethdb.Database) (*StateDB, error) {
 	tr, err := trie.NewSecure(root, db)
 	if err != nil {
-		// TODO: bubble this up
-		tr, _ = trie.NewSecure(common.Hash{}, db)
 		glog.Errorf("can't create state trie with root %x: %v", root[:], err)
+		return nil, err
 	}
 	return &StateDB{
 		db:           db,
@@ -65,7 +64,7 @@ func New(root common.Hash, db ethdb.Database) *StateDB {
 		stateObjects: make(map[string]*StateObject),
 		refund:       new(big.Int),
 		logs:         make(map[common.Hash]vm.Logs),
-	}
+	}, nil
 }
 
 func (self *StateDB) StartRecord(thash, bhash common.Hash, ti int) {
@@ -297,7 +296,8 @@ func (self *StateDB) CreateAccount(addr common.Address) vm.Account {
 //
 
 func (self *StateDB) Copy() *StateDB {
-	state := New(common.Hash{}, self.db)
+	// ignore error - we assume state-to-be-copied always exists
+	state, _ := New(common.Hash{}, self.db)
 	state.trie = self.trie
 	for k, stateObject := range self.stateObjects {
 		state.stateObjects[k] = stateObject.Copy()
diff --git a/core/transaction_pool.go b/core/transaction_pool.go
index a4e6ce3e2f..16f66efdcf 100644
--- a/core/transaction_pool.go
+++ b/core/transaction_pool.go
@@ -48,7 +48,7 @@ const (
 	maxQueued = 64 // max limit of queued txs per address
 )
 
-type stateFn func() *state.StateDB
+type stateFn func() (*state.StateDB, error)
 
 // TxPool contains all currently known transactions. Transactions
 // enter the pool when they are received from the network or submitted
@@ -80,7 +80,7 @@ func NewTxPool(eventMux *event.TypeMux, currentStateFn stateFn, gasLimitFn func(
 		currentState: currentStateFn,
 		gasLimit:     gasLimitFn,
 		minGasPrice:  new(big.Int),
-		pendingState: state.ManageState(currentStateFn()),
+		pendingState: nil,
 		events:       eventMux.Subscribe(ChainHeadEvent{}, GasPriceChanged{}, RemovedTransactionEvent{}),
 	}
 	go pool.eventLoop()
@@ -109,7 +109,17 @@ func (pool *TxPool) eventLoop() {
 }
 
 func (pool *TxPool) resetState() {
-	pool.pendingState = state.ManageState(pool.currentState())
+	currentState, err := pool.currentState()
+	if err != nil {
+		glog.V(logger.Info).Infoln("failed to get current state: %v", err)
+		return
+	}
+	managedState := state.ManageState(currentState)
+	if err != nil {
+		glog.V(logger.Info).Infoln("failed to get managed state: %v", err)
+		return
+	}
+	pool.pendingState = managedState
 
 	// validate the pool of pending transactions, this will remove
 	// any transactions that have been included in the block or
@@ -180,12 +190,16 @@ func (pool *TxPool) validateTx(tx *types.Transaction) error {
 
 	// Make sure the account exist. Non existent accounts
 	// haven't got funds and well therefor never pass.
-	if !pool.currentState().HasAccount(from) {
+	currentState, err := pool.currentState()
+	if err != nil {
+		return err
+	}
+	if !currentState.HasAccount(from) {
 		return ErrNonExistentAccount
 	}
 
 	// Last but not least check for nonce errors
-	if pool.currentState().GetNonce(from) > tx.Nonce() {
+	if currentState.GetNonce(from) > tx.Nonce() {
 		return ErrNonce
 	}
 
@@ -204,7 +218,7 @@ func (pool *TxPool) validateTx(tx *types.Transaction) error {
 
 	// Transactor should have enough funds to cover the costs
 	// cost == V + GP * GL
-	if pool.currentState().GetBalance(from).Cmp(tx.Cost()) < 0 {
+	if currentState.GetBalance(from).Cmp(tx.Cost()) < 0 {
 		return ErrInsufficientFunds
 	}
 
@@ -257,6 +271,11 @@ func (self *TxPool) queueTx(hash common.Hash, tx *types.Transaction) {
 
 // addTx will add a transaction to the pending (processable queue) list of transactions
 func (pool *TxPool) addTx(hash common.Hash, addr common.Address, tx *types.Transaction) {
+	// init delayed since tx pool could have been started before any state sync
+	if pool.pendingState == nil {
+		pool.resetState()
+	}
+
 	if _, ok := pool.pending[hash]; !ok {
 		pool.pending[hash] = tx
 
@@ -382,14 +401,22 @@ func (pool *TxPool) RemoveTx(hash common.Hash) {
 
 // checkQueue moves transactions that have become processable to main pool.
 func (pool *TxPool) checkQueue() {
-	state := pool.pendingState
+	// init delayed since tx pool could have been started before any state sync
+	if pool.pendingState == nil {
+		pool.resetState()
+	}
 
 	var addq txQueue
 	for address, txs := range pool.queue {
 		// guessed nonce is the nonce currently kept by the tx pool (pending state)
-		guessedNonce := state.GetNonce(address)
+		guessedNonce := pool.pendingState.GetNonce(address)
 		// true nonce is the nonce known by the last state
-		trueNonce := pool.currentState().GetNonce(address)
+		currentState, err := pool.currentState()
+		if err != nil {
+			glog.Errorf("could not get current state: %v", err)
+			return
+		}
+		trueNonce := currentState.GetNonce(address)
 		addq := addq[:0]
 		for hash, tx := range txs {
 			if tx.Nonce() < trueNonce {
@@ -434,7 +461,11 @@ func (pool *TxPool) checkQueue() {
 
 // validatePool removes invalid and processed transactions from the main pool.
 func (pool *TxPool) validatePool() {
-	state := pool.currentState()
+	state, err := pool.currentState()
+	if err != nil {
+		glog.V(logger.Info).Infoln("failed to get current state: %v", err)
+		return
+	}
 	for hash, tx := range pool.pending {
 		from, _ := tx.From() // err already checked
 		// perform light nonce validation
diff --git a/core/transaction_pool_test.go b/core/transaction_pool_test.go
index 37cd20c964..229dcacf37 100644
--- a/core/transaction_pool_test.go
+++ b/core/transaction_pool_test.go
@@ -36,11 +36,13 @@ func transaction(nonce uint64, gaslimit *big.Int, key *ecdsa.PrivateKey) *types.
 
 func setupTxPool() (*TxPool, *ecdsa.PrivateKey) {
 	db, _ := ethdb.NewMemDatabase()
-	statedb := state.New(common.Hash{}, db)
+	statedb, _ := state.New(common.Hash{}, db)
 
 	var m event.TypeMux
 	key, _ := crypto.GenerateKey()
-	return NewTxPool(&m, func() *state.StateDB { return statedb }, func() *big.Int { return big.NewInt(1000000) }), key
+	newPool := NewTxPool(&m, func() (*state.StateDB, error) { return statedb, nil }, func() *big.Int { return big.NewInt(1000000) })
+	newPool.resetState()
+	return newPool, key
 }
 
 func TestInvalidTransactions(t *testing.T) {
@@ -52,19 +54,20 @@ func TestInvalidTransactions(t *testing.T) {
 	}
 
 	from, _ := tx.From()
-	pool.currentState().AddBalance(from, big.NewInt(1))
+	currentState, _ := pool.currentState()
+	currentState.AddBalance(from, big.NewInt(1))
 	if err := pool.Add(tx); err != ErrInsufficientFunds {
 		t.Error("expected", ErrInsufficientFunds)
 	}
 
 	balance := new(big.Int).Add(tx.Value(), new(big.Int).Mul(tx.Gas(), tx.GasPrice()))
-	pool.currentState().AddBalance(from, balance)
+	currentState.AddBalance(from, balance)
 	if err := pool.Add(tx); err != ErrIntrinsicGas {
 		t.Error("expected", ErrIntrinsicGas, "got", err)
 	}
 
-	pool.currentState().SetNonce(from, 1)
-	pool.currentState().AddBalance(from, big.NewInt(0xffffffffffffff))
+	currentState.SetNonce(from, 1)
+	currentState.AddBalance(from, big.NewInt(0xffffffffffffff))
 	tx = transaction(0, big.NewInt(100000), key)
 	if err := pool.Add(tx); err != ErrNonce {
 		t.Error("expected", ErrNonce)
@@ -75,7 +78,8 @@ func TestTransactionQueue(t *testing.T) {
 	pool, key := setupTxPool()
 	tx := transaction(0, big.NewInt(100), key)
 	from, _ := tx.From()
-	pool.currentState().AddBalance(from, big.NewInt(1))
+	currentState, _ := pool.currentState()
+	currentState.AddBalance(from, big.NewInt(1))
 	pool.queueTx(tx.Hash(), tx)
 
 	pool.checkQueue()
@@ -85,7 +89,7 @@ func TestTransactionQueue(t *testing.T) {
 
 	tx = transaction(1, big.NewInt(100), key)
 	from, _ = tx.From()
-	pool.currentState().SetNonce(from, 2)
+	currentState.SetNonce(from, 2)
 	pool.queueTx(tx.Hash(), tx)
 	pool.checkQueue()
 	if _, ok := pool.pending[tx.Hash()]; ok {
@@ -119,7 +123,8 @@ func TestRemoveTx(t *testing.T) {
 	pool, key := setupTxPool()
 	tx := transaction(0, big.NewInt(100), key)
 	from, _ := tx.From()
-	pool.currentState().AddBalance(from, big.NewInt(1))
+	currentState, _ := pool.currentState()
+	currentState.AddBalance(from, big.NewInt(1))
 	pool.queueTx(tx.Hash(), tx)
 	pool.addTx(tx.Hash(), from, tx)
 	if len(pool.queue) != 1 {
@@ -146,7 +151,8 @@ func TestNegativeValue(t *testing.T) {
 
 	tx, _ := types.NewTransaction(0, common.Address{}, big.NewInt(-1), big.NewInt(100), big.NewInt(1), nil).SignECDSA(key)
 	from, _ := tx.From()
-	pool.currentState().AddBalance(from, big.NewInt(1))
+	currentState, _ := pool.currentState()
+	currentState.AddBalance(from, big.NewInt(1))
 	if err := pool.Add(tx); err != ErrNegativeValue {
 		t.Error("expected", ErrNegativeValue, "got", err)
 	}
@@ -157,9 +163,10 @@ func TestTransactionChainFork(t *testing.T) {
 	addr := crypto.PubkeyToAddress(key.PublicKey)
 	resetState := func() {
 		db, _ := ethdb.NewMemDatabase()
-		statedb := state.New(common.Hash{}, db)
-		pool.currentState = func() *state.StateDB { return statedb }
-		pool.currentState().AddBalance(addr, big.NewInt(100000000000000))
+		statedb, _ := state.New(common.Hash{}, db)
+		pool.currentState = func() (*state.StateDB, error) { return statedb, nil }
+		currentState, _ := pool.currentState()
+		currentState.AddBalance(addr, big.NewInt(100000000000000))
 		pool.resetState()
 	}
 	resetState()
@@ -182,9 +189,10 @@ func TestTransactionDoubleNonce(t *testing.T) {
 	addr := crypto.PubkeyToAddress(key.PublicKey)
 	resetState := func() {
 		db, _ := ethdb.NewMemDatabase()
-		statedb := state.New(common.Hash{}, db)
-		pool.currentState = func() *state.StateDB { return statedb }
-		pool.currentState().AddBalance(addr, big.NewInt(100000000000000))
+		statedb, _ := state.New(common.Hash{}, db)
+		pool.currentState = func() (*state.StateDB, error) { return statedb, nil }
+		currentState, _ := pool.currentState()
+		currentState.AddBalance(addr, big.NewInt(100000000000000))
 		pool.resetState()
 	}
 	resetState()
@@ -207,7 +215,8 @@ func TestTransactionDoubleNonce(t *testing.T) {
 func TestMissingNonce(t *testing.T) {
 	pool, key := setupTxPool()
 	addr := crypto.PubkeyToAddress(key.PublicKey)
-	pool.currentState().AddBalance(addr, big.NewInt(100000000000000))
+	currentState, _ := pool.currentState()
+	currentState.AddBalance(addr, big.NewInt(100000000000000))
 	tx := transaction(1, big.NewInt(100000), key)
 	if err := pool.add(tx); err != nil {
 		t.Error("didn't expect error", err)
@@ -224,15 +233,16 @@ func TestNonceRecovery(t *testing.T) {
 	const n = 10
 	pool, key := setupTxPool()
 	addr := crypto.PubkeyToAddress(key.PublicKey)
-	pool.currentState().SetNonce(addr, n)
-	pool.currentState().AddBalance(addr, big.NewInt(100000000000000))
+	currentState, _ := pool.currentState()
+	currentState.SetNonce(addr, n)
+	currentState.AddBalance(addr, big.NewInt(100000000000000))
 	pool.resetState()
 	tx := transaction(n, big.NewInt(100000), key)
 	if err := pool.Add(tx); err != nil {
 		t.Error(err)
 	}
 	// simulate some weird re-order of transactions and missing nonce(s)
-	pool.currentState().SetNonce(addr, n-1)
+	currentState.SetNonce(addr, n-1)
 	pool.resetState()
 	if fn := pool.pendingState.GetNonce(addr); fn != n+1 {
 		t.Errorf("expected nonce to be %d, got %d", n+1, fn)
@@ -243,7 +253,8 @@ func TestRemovedTxEvent(t *testing.T) {
 	pool, key := setupTxPool()
 	tx := transaction(0, big.NewInt(1000000), key)
 	from, _ := tx.From()
-	pool.currentState().AddBalance(from, big.NewInt(1000000000000))
+	currentState, _ := pool.currentState()
+	currentState.AddBalance(from, big.NewInt(1000000000000))
 	pool.eventMux.Post(RemovedTransactionEvent{types.Transactions{tx}})
 	pool.eventMux.Post(ChainHeadEvent{nil})
 	if len(pool.pending) != 1 {
diff --git a/eth/backend.go b/eth/backend.go
index 83eefca5b5..18900c91e0 100644
--- a/eth/backend.go
+++ b/eth/backend.go
@@ -389,7 +389,8 @@ func New(config *Config) (*Ethereum, error) {
 
 		return nil, err
 	}
-	eth.txPool = core.NewTxPool(eth.EventMux(), eth.blockchain.State, eth.blockchain.GasLimit)
+	newPool := core.NewTxPool(eth.EventMux(), eth.blockchain.State, eth.blockchain.GasLimit)
+	eth.txPool = newPool
 
 	eth.blockProcessor = core.NewBlockProcessor(chainDb, eth.pow, eth.blockchain, eth.EventMux())
 	eth.blockchain.SetProcessor(eth.blockProcessor)
diff --git a/eth/handler_test.go b/eth/handler_test.go
index 2b8c6168a8..dde2ecbd51 100644
--- a/eth/handler_test.go
+++ b/eth/handler_test.go
@@ -443,10 +443,11 @@ func testGetNodeData(t *testing.T, protocol int) {
 	}
 	accounts := []common.Address{testBankAddress, acc1Addr, acc2Addr}
 	for i := uint64(0); i <= pm.blockchain.CurrentBlock().NumberU64(); i++ {
-		trie := state.New(pm.blockchain.GetBlockByNumber(i).Root(), statedb)
+		trie, _ := state.New(pm.blockchain.GetBlockByNumber(i).Root(), statedb)
 
 		for j, acc := range accounts {
-			bw := pm.blockchain.State().GetBalance(acc)
+			state, _ := pm.blockchain.State()
+			bw := state.GetBalance(acc)
 			bh := trie.GetBalance(acc)
 
 			if (bw != nil && bh == nil) || (bw == nil && bh != nil) {
diff --git a/eth/helper_test.go b/eth/helper_test.go
index e42fa1f82b..9314884efb 100644
--- a/eth/helper_test.go
+++ b/eth/helper_test.go
@@ -38,7 +38,8 @@ func newTestProtocolManager(blocks int, generator func(int, *core.BlockGen), new
 		blockproc     = core.NewBlockProcessor(db, pow, blockchain, evmux)
 	)
 	blockchain.SetProcessor(blockproc)
-	if _, err := blockchain.InsertChain(core.GenerateChain(genesis, db, blocks, generator)); err != nil {
+	chain := core.GenerateChain(genesis, db, blocks, generator)
+	if _, err := blockchain.InsertChain(chain); err != nil {
 		panic(err)
 	}
 	pm := NewProtocolManager(NetworkId, evmux, &testTxPool{added: newtx}, pow, blockchain, db)
diff --git a/miner/worker.go b/miner/worker.go
index 43f6f9909c..83653e3278 100644
--- a/miner/worker.go
+++ b/miner/worker.go
@@ -353,8 +353,11 @@ func (self *worker) push(work *Work) {
 }
 
 // makeCurrent creates a new environment for the current cycle.
-func (self *worker) makeCurrent(parent *types.Block, header *types.Header) {
-	state := state.New(parent.Root(), self.eth.ChainDb())
+func (self *worker) makeCurrent(parent *types.Block, header *types.Header) error {
+	state, err := state.New(parent.Root(), self.eth.ChainDb())
+	if err != nil {
+		return err
+	}
 	work := &Work{
 		state:     state,
 		ancestors: set.New(),
@@ -385,6 +388,7 @@ func (self *worker) makeCurrent(parent *types.Block, header *types.Header) {
 		work.localMinedBlocks = self.current.localMinedBlocks
 	}
 	self.current = work
+	return nil
 }
 
 func (w *worker) setGasPrice(p *big.Int) {
@@ -464,7 +468,12 @@ func (self *worker) commitNewWork() {
 	}
 
 	previous := self.current
-	self.makeCurrent(parent, header)
+	// Could potentially happen if starting to mine in an odd state.
+	err := self.makeCurrent(parent, header)
+	if err != nil {
+		glog.V(logger.Info).Infoln("Could not create new env for mining, retrying on next block.")
+		return
+	}
 	work := self.current
 
 	/* //approach 1
diff --git a/rpc/api/debug.go b/rpc/api/debug.go
index e193f7ad2d..003b4d9940 100644
--- a/rpc/api/debug.go
+++ b/rpc/api/debug.go
@@ -119,9 +119,9 @@ func (self *debugApi) DumpBlock(req *shared.Request) (interface{}, error) {
 		return nil, fmt.Errorf("block #%d not found", args.BlockNumber)
 	}
 
-	stateDb := state.New(block.Root(), self.ethereum.ChainDb())
-	if stateDb == nil {
-		return nil, nil
+	stateDb, err := state.New(block.Root(), self.ethereum.ChainDb())
+	if err != nil {
+		return nil, err
 	}
 
 	return stateDb.RawDump(), nil
diff --git a/tests/block_test_util.go b/tests/block_test_util.go
index fb9ca16e68..4c329631ab 100644
--- a/tests/block_test_util.go
+++ b/tests/block_test_util.go
@@ -162,9 +162,25 @@ func runBlockTests(bt map[string]*BlockTest, skipTests []string) error {
 
 }
 func runBlockTest(test *BlockTest) error {
-	cfg := test.makeEthConfig()
+	ks := crypto.NewKeyStorePassphrase(filepath.Join(common.DefaultDataDir(), "keystore"))
+	am := accounts.NewManager(ks)
+	db, _ := ethdb.NewMemDatabase()
+	cfg := &eth.Config{
+		DataDir:        common.DefaultDataDir(),
+		Verbosity:      5,
+		Etherbase:      common.Address{},
+		AccountManager: am,
+		NewDB:          func(path string) (ethdb.Database, error) { return db, nil },
+	}
+
 	cfg.GenesisBlock = test.Genesis
 
+	// import pre accounts & construct test genesis block & state root
+	_, err := test.InsertPreState(db, am)
+	if err != nil {
+		return fmt.Errorf("InsertPreState: %v", err)
+	}
+
 	ethereum, err := eth.New(cfg)
 	if err != nil {
 		return err
@@ -175,12 +191,6 @@ func runBlockTest(test *BlockTest) error {
 		return err
 	}
 
-	// import pre accounts
-	_, err = test.InsertPreState(ethereum)
-	if err != nil {
-		return fmt.Errorf("InsertPreState: %v", err)
-	}
-
 	cm := ethereum.BlockChain()
 	validBlocks, err := test.TryBlocksInsert(cm)
 	if err != nil {
@@ -193,7 +203,10 @@ func runBlockTest(test *BlockTest) error {
 		return fmt.Errorf("lastblockhash validation mismatch: want: %x, have: %x", lastblockhash, cmlast)
 	}
 
-	newDB := cm.State()
+	newDB, err := cm.State()
+	if err != nil {
+		return err
+	}
 	if err = test.ValidatePostState(newDB); err != nil {
 		return fmt.Errorf("post state validation failed: %v", err)
 	}
@@ -201,23 +214,13 @@ func runBlockTest(test *BlockTest) error {
 	return test.ValidateImportedHeaders(cm, validBlocks)
 }
 
-func (test *BlockTest) makeEthConfig() *eth.Config {
-	ks := crypto.NewKeyStorePassphrase(filepath.Join(common.DefaultDataDir(), "keystore"))
-
-	return &eth.Config{
-		DataDir:        common.DefaultDataDir(),
-		Verbosity:      5,
-		Etherbase:      common.Address{},
-		AccountManager: accounts.NewManager(ks),
-		NewDB:          func(path string) (ethdb.Database, error) { return ethdb.NewMemDatabase() },
-	}
-}
-
 // InsertPreState populates the given database with the genesis
 // accounts defined by the test.
-func (t *BlockTest) InsertPreState(ethereum *eth.Ethereum) (*state.StateDB, error) {
-	db := ethereum.ChainDb()
-	statedb := state.New(common.Hash{}, db)
+func (t *BlockTest) InsertPreState(db ethdb.Database, am *accounts.Manager) (*state.StateDB, error) {
+	statedb, err := state.New(common.Hash{}, db)
+	if err != nil {
+		return nil, err
+	}
 	for addrString, acct := range t.preAccounts {
 		addr, err := hex.DecodeString(addrString)
 		if err != nil {
@@ -239,7 +242,7 @@ func (t *BlockTest) InsertPreState(ethereum *eth.Ethereum) (*state.StateDB, erro
 		if acct.PrivateKey != "" {
 			privkey, err := hex.DecodeString(strings.TrimPrefix(acct.PrivateKey, "0x"))
 			err = crypto.ImportBlockTestKey(privkey)
-			err = ethereum.AccountManager().TimedUnlock(common.BytesToAddress(addr), "", 999999*time.Second)
+			err = am.TimedUnlock(common.BytesToAddress(addr), "", 999999*time.Second)
 			if err != nil {
 				return nil, err
 			}
diff --git a/tests/state_test_util.go b/tests/state_test_util.go
index a1c066c82d..676d9ed8cb 100644
--- a/tests/state_test_util.go
+++ b/tests/state_test_util.go
@@ -103,7 +103,7 @@ func BenchStateTest(p string, conf bconf, b *testing.B) error {
 func benchStateTest(test VmTest, env map[string]string, b *testing.B) {
 	b.StopTimer()
 	db, _ := ethdb.NewMemDatabase()
-	statedb := state.New(common.Hash{}, db)
+	statedb, _ := state.New(common.Hash{}, db)
 	for addr, account := range test.Pre {
 		obj := StateObjectFromAccount(db, addr, account)
 		statedb.SetStateObject(obj)
@@ -142,7 +142,7 @@ func runStateTests(tests map[string]VmTest, skipTests []string) error {
 
 func runStateTest(test VmTest) error {
 	db, _ := ethdb.NewMemDatabase()
-	statedb := state.New(common.Hash{}, db)
+	statedb, _ := state.New(common.Hash{}, db)
 	for addr, account := range test.Pre {
 		obj := StateObjectFromAccount(db, addr, account)
 		statedb.SetStateObject(obj)
diff --git a/tests/vm_test_util.go b/tests/vm_test_util.go
index b61995e31e..ddd14b1a3e 100644
--- a/tests/vm_test_util.go
+++ b/tests/vm_test_util.go
@@ -108,7 +108,7 @@ func BenchVmTest(p string, conf bconf, b *testing.B) error {
 func benchVmTest(test VmTest, env map[string]string, b *testing.B) {
 	b.StopTimer()
 	db, _ := ethdb.NewMemDatabase()
-	statedb := state.New(common.Hash{}, db)
+	statedb, _ := state.New(common.Hash{}, db)
 	for addr, account := range test.Pre {
 		obj := StateObjectFromAccount(db, addr, account)
 		statedb.SetStateObject(obj)
@@ -159,7 +159,7 @@ func runVmTests(tests map[string]VmTest, skipTests []string) error {
 
 func runVmTest(test VmTest) error {
 	db, _ := ethdb.NewMemDatabase()
-	statedb := state.New(common.Hash{}, db)
+	statedb, _ := state.New(common.Hash{}, db)
 	for addr, account := range test.Pre {
 		obj := StateObjectFromAccount(db, addr, account)
 		statedb.SetStateObject(obj)
diff --git a/xeth/xeth.go b/xeth/xeth.go
index 13e1712709..3b487fed89 100644
--- a/xeth/xeth.go
+++ b/xeth/xeth.go
@@ -126,7 +126,11 @@ func New(ethereum *eth.Ethereum, frontend Frontend) *XEth {
 	if frontend == nil {
 		xeth.frontend = dummyFrontend{}
 	}
-	xeth.state = NewState(xeth, xeth.backend.BlockChain().State())
+	state, err := xeth.backend.BlockChain().State()
+	if err != nil {
+		return nil
+	}
+	xeth.state = NewState(xeth, state)
 
 	go xeth.start()
 
@@ -207,14 +211,21 @@ func (self *XEth) RemoteMining() *miner.RemoteAgent { return self.agent }
 
 func (self *XEth) AtStateNum(num int64) *XEth {
 	var st *state.StateDB
+	var err error
 	switch num {
 	case -2:
 		st = self.backend.Miner().PendingState().Copy()
 	default:
 		if block := self.getBlockByHeight(num); block != nil {
-			st = state.New(block.Root(), self.backend.ChainDb())
+			st, err = state.New(block.Root(), self.backend.ChainDb())
+			if err != nil {
+				return nil
+			}
 		} else {
-			st = state.New(self.backend.BlockChain().GetBlockByNumber(0).Root(), self.backend.ChainDb())
+			st, err = state.New(self.backend.BlockChain().GetBlockByNumber(0).Root(), self.backend.ChainDb())
+			if err != nil {
+				return nil
+			}
 		}
 	}
 
@@ -266,7 +277,11 @@ func (self *XEth) UpdateState() (wait chan *big.Int) {
 						wait <- n
 						n = nil
 					}
-					statedb := state.New(event.Block.Root(), self.backend.ChainDb())
+					statedb, err := state.New(event.Block.Root(), self.backend.ChainDb())
+					if err != nil {
+						glog.V(logger.Error).Infoln("Could not create new state: %v", err)
+						return
+					}
 					self.state = NewState(self, statedb)
 				}
 			case n, ok = <-wait: