diff --git a/core/genesis.go b/core/genesis.go
index dbcacb9e7c..4c197abc52 100644
--- a/core/genesis.go
+++ b/core/genesis.go
@@ -432,7 +432,7 @@ func DefaultLocalGenesisBlock(consensusEngine string) *Genesis {
 			Nonce:      66,
 			ExtraData:  hexutil.MustDecode("0x11bbe8db4e347b4e8c937c1c8370e4b5ed33adb3db69cbdb7a38e1e50b1b82fb"),
 			GasLimit:   5000000,
-			Difficulty: big.NewInt(100000),
+			Difficulty: big.NewInt(10000),
 		}
 	}
 	return &Genesis{
diff --git a/core/headerchain.go b/core/headerchain.go
index 4d3143d435..b0a416f6fb 100644
--- a/core/headerchain.go
+++ b/core/headerchain.go
@@ -473,10 +473,10 @@ func (hc *HeaderChain) SetCurrentState(head *types.WorkObject) error {
 		if hc.IsGenesisHash(header.Hash()) {
 			break
 		}
-		// This is not perfect because it's possible some blocks have the same root hash (no uniqueness guarantee)
-		// We probably need a better way to determine if we have processed the state and ETXs for a given block
-		_, err := hc.bc.processor.StateAt(header.EVMRoot(), header.UTXORoot(), header.EtxSetRoot())
-		if err == nil {
+
+		// Check if the state has been processed for this block
+		processedState := rawdb.ReadProcessedState(hc.headerDb, header.Hash())
+		if processedState {
 			break
 		}
 		current = types.CopyWorkObject(header)
diff --git a/core/rawdb/accessors_chain.go b/core/rawdb/accessors_chain.go
index 4aaa3dd8cd..d70d2d7f2c 100644
--- a/core/rawdb/accessors_chain.go
+++ b/core/rawdb/accessors_chain.go
@@ -132,6 +132,20 @@ func DeleteHeaderNumber(db ethdb.KeyValueWriter, hash common.Hash) {
 	}
 }
 
+func ReadProcessedState(db ethdb.KeyValueReader, hash common.Hash) bool {
+	data, _ := db.Get(processedStateKey(hash))
+	if len(data) == 0 {
+		return false
+	}
+	return data[0] == 1
+}
+
+func WriteProcessedState(db ethdb.KeyValueWriter, hash common.Hash) {
+	if err := db.Put(processedStateKey(hash), []byte{1}); err != nil {
+		db.Logger().WithField("err", err).Fatal("Failed to store processed state for block " + hash.String())
+	}
+}
+
 // ReadHeadHeaderHash retrieves the hash of the current canonical head header.
 func ReadHeadHeaderHash(db ethdb.KeyValueReader) common.Hash {
 	data, _ := db.Get(headHeaderKey)
diff --git a/core/rawdb/schema.go b/core/rawdb/schema.go
index a040d22028..fa1dd034a3 100644
--- a/core/rawdb/schema.go
+++ b/core/rawdb/schema.go
@@ -108,6 +108,7 @@ var (
 	UtxoPrefix                  = []byte("ut")    // outpointPrefix + hash -> types.Outpoint
 	spentUTXOsPrefix            = []byte("sutxo") // spentUTXOsPrefix + hash -> []types.SpentTxOut
 	AddressUtxosPrefix          = []byte("au")    // addressUtxosPrefix + hash -> []types.UtxoEntry
+	processedStatePrefix        = []byte("ps")    // processedStatePrefix + hash -> boolean
 
 	blockBodyPrefix         = []byte("b")   // blockBodyPrefix + num (uint64 big endian) + hash -> block body
 	blockReceiptsPrefix     = []byte("r")   // blockReceiptsPrefix + num (uint64 big endian) + hash -> block receipts
@@ -268,6 +269,10 @@ func headerNumberKey(hash common.Hash) []byte {
 	return append(headerNumberPrefix, hash.Bytes()...)
 }
 
+func processedStateKey(hash common.Hash) []byte {
+	return append(processedStatePrefix, hash.Bytes()...)
+}
+
 // blockBodyKey = blockBodyPrefix + num (uint64 big endian) + hash
 func blockBodyKey(number uint64, hash common.Hash) []byte {
 	return append(append(blockBodyPrefix, encodeBlockNumber(number)...), hash.Bytes()...)
diff --git a/core/state/statedb.go b/core/state/statedb.go
index 619b13860e..4902817ae3 100644
--- a/core/state/statedb.go
+++ b/core/state/statedb.go
@@ -26,6 +26,7 @@ import (
 	"time"
 
 	"github.com/prometheus/client_golang/prometheus"
+	"google.golang.org/protobuf/proto"
 
 	"github.com/dominant-strategies/go-quai/common"
 	"github.com/dominant-strategies/go-quai/core/rawdb"
@@ -646,7 +647,11 @@ func (s *StateDB) PushETX(etx *types.Transaction) error {
 	if metrics_config.MetricsEnabled() {
 		defer func(start time.Time) { stateMetrics.WithLabelValues("AddETX").Add(float64(time.Since(start))) }(time.Now())
 	}
-	data, err := rlp.EncodeToBytes(etx)
+	protoTx, err := etx.ProtoEncode()
+	if err != nil {
+		return err
+	}
+	protoTxBytes, err := proto.Marshal(protoTx)
 	if err != nil {
 		return err
 	}
@@ -654,7 +659,7 @@ func (s *StateDB) PushETX(etx *types.Transaction) error {
 	if err != nil {
 		return err
 	}
-	if err := s.etxTrie.TryUpdate(newestIndex.Bytes(), data); err != nil {
+	if err := s.etxTrie.TryUpdate(newestIndex.Bytes(), protoTxBytes); err != nil {
 		return err
 	}
 	newestIndex.Add(newestIndex, big.NewInt(1))
@@ -673,11 +678,15 @@ func (s *StateDB) PushETXs(etxs []*types.Transaction) error {
 		return err
 	}
 	for _, etx := range etxs {
-		data, err := rlp.EncodeToBytes(etx)
+		protoTx, err := etx.ProtoEncode()
+		if err != nil {
+			return err
+		}
+		protoTxBytes, err := proto.Marshal(protoTx)
 		if err != nil {
 			return err
 		}
-		if err := s.etxTrie.TryUpdate(newestIndex.Bytes(), data); err != nil {
+		if err := s.etxTrie.TryUpdate(newestIndex.Bytes(), protoTxBytes); err != nil {
 			return err
 		}
 		newestIndex.Add(newestIndex, big.NewInt(1))
@@ -703,8 +712,12 @@ func (s *StateDB) PopETX() (*types.Transaction, error) {
 	if len(enc) == 0 {
 		return nil, nil
 	}
+	protoEtx := new(types.ProtoTransaction)
+	if err := proto.Unmarshal(enc, protoEtx); err != nil {
+		return nil, err
+	}
 	etx := new(types.Transaction)
-	if err := rlp.DecodeBytes(enc, etx); err != nil {
+	if err := etx.ProtoDecode(protoEtx, s.nodeLocation); err != nil {
 		return nil, err
 	}
 	if err := s.etxTrie.TryDelete(oldestIndex.Bytes()); err != nil {
@@ -725,8 +738,12 @@ func (s *StateDB) ReadETX(index *big.Int) (*types.Transaction, error) {
 	if len(enc) == 0 {
 		return nil, nil
 	}
+	protoEtx := new(types.ProtoTransaction)
+	if err := proto.Unmarshal(enc, protoEtx); err != nil {
+		return nil, err
+	}
 	etx := new(types.Transaction)
-	if err := rlp.DecodeBytes(enc, etx); err != nil {
+	if err := etx.ProtoDecode(protoEtx, s.nodeLocation); err != nil {
 		return nil, err
 	}
 	return etx, nil
diff --git a/core/state_processor.go b/core/state_processor.go
index 639d5a720d..ff263a61bc 100644
--- a/core/state_processor.go
+++ b/core/state_processor.go
@@ -931,6 +931,8 @@ func (p *StateProcessor) Apply(batch ethdb.Batch, block *types.WorkObject) ([]*t
 		"t7":   time7,
 		"t8":   time8,
 	}).Debug("times during state processor apply")
+	// Indicate that we have processed the state of the block
+	rawdb.WriteProcessedState(batch, block.Hash())
 	return logs, nil
 }
 
diff --git a/core/types/external_tx.go b/core/types/external_tx.go
index 0a121b0bfb..8b0203aa77 100644
--- a/core/types/external_tx.go
+++ b/core/types/external_tx.go
@@ -189,5 +189,5 @@ func (tx *ExternalTx) setEcdsaSignatureValues(chainID, v, r, s *big.Int) {
 }
 
 func (tx *ExternalTx) setTo(to common.Address) {
-	panic("You should not set To on an external transaction")
+	tx.To = &to
 }
diff --git a/core/types/transaction.go b/core/types/transaction.go
index 642fea8e72..dc13171a92 100644
--- a/core/types/transaction.go
+++ b/core/types/transaction.go
@@ -106,7 +106,6 @@ type TxData interface {
 	parentHash() *common.Hash
 	mixHash() *common.Hash
 	workNonce() *BlockNonce
-
 	// Schnorr segregated sigs
 	getSchnorrSignature() *schnorr.Signature
 }
@@ -605,7 +604,7 @@ func (tx *Transaction) To() *common.Address {
 	return &cpy
 }
 
-func (tx *Transaction) SetGas(addr common.Address) {
+func (tx *Transaction) SetTo(addr common.Address) {
 	tx.inner.setTo(addr)
 }
 
diff --git a/internal/quaiapi/quai_api.go b/internal/quaiapi/quai_api.go
index bbee7ae0e1..643cfc0c1d 100644
--- a/internal/quaiapi/quai_api.go
+++ b/internal/quaiapi/quai_api.go
@@ -768,6 +768,9 @@ func (s *PublicBlockChainQuaiAPI) Append(ctx context.Context, raw json.RawMessag
 	}
 
 	body.Header.Header().SetCoinbase(common.BytesToAddress(body.Header.Coinbase().Bytes(), s.b.NodeLocation()))
+	for _, tx := range body.NewInboundEtxs {
+		tx.SetTo(common.BytesToAddress(tx.To().Bytes(), s.b.NodeLocation()))
+	}
 	pendingEtxs, subReorg, setHead, err := s.b.Append(body.Header, body.Manifest, body.DomPendingHeader, body.DomTerminus, body.DomOrigin, body.NewInboundEtxs)
 	if err != nil {
 		return nil, err
diff --git a/params/config.go b/params/config.go
index bcccb96373..ac09690064 100644
--- a/params/config.go
+++ b/params/config.go
@@ -36,7 +36,7 @@ var (
 	Blake3PowColosseumGenesisHash  = common.HexToHash("0x0ca6ff4426eab568de6773fb21d623d3fe6f2f0d2572c0b0b978384373e0895d")
 	Blake3PowGardenGenesisHash     = common.HexToHash("0x43af9e6e91fbf408b9c6fd423ed34e5ad0bd2154737cefc204d145ffc660fc9c")
 	Blake3PowOrchardGenesisHash    = common.HexToHash("0x43af9e6e91fbf408b9c6fd423ed34e5ad0bd2154737cefc204d145ffc660fc9c")
-	Blake3PowLocalGenesisHash      = common.HexToHash("0xe145f05594415f1e7b7fdf261d41be71f9a9e53b9d07e4ec9d2658cefc4916ab")
+	Blake3PowLocalGenesisHash      = common.HexToHash("0x3946bd52e33904f841d259cace4a22cce9a34f748f025bf8b1040a3f9300d201")
 	Blake3PowLighthouseGenesisHash = common.HexToHash("0x43af9e6e91fbf408b9c6fd423ed34e5ad0bd2154737cefc204d145ffc660fc9c")
 )