diff --git a/lightningd/Makefile b/lightningd/Makefile
index 0337d7376..a4b17ca61 100644
--- a/lightningd/Makefile
+++ b/lightningd/Makefile
@@ -95,7 +95,8 @@ LIGHTNINGD_HEADERS_NOGEN =			\
 	$(BITCOIN_HEADERS)			\
 	$(CORE_HEADERS)				\
 	$(CORE_TX_HEADERS)			\
-	$(DAEMON_HEADERS)
+	$(DAEMON_HEADERS)			\
+	$(WALLET_LIB_HEADERS)
 
 # Generated headers
 LIGHTNINGD_HEADERS_GEN =			\
@@ -138,7 +139,7 @@ check-makefile: check-lightningd-makefile
 check-lightningd-makefile:
 	@for f in lightningd/*.h lightningd/*/*.h; do if ! echo $(LIGHTNINGD_HEADERS_NOGEN) $(LIGHTNINGD_HEADERS_GEN) "" | grep -q "$$f "; then echo $$f not mentioned in LIGHTNINGD_HEADERS_NOGEN or LIGHTNINGD_HEADERS_GEN >&2; exit 1; fi; done
 
-lightningd/lightningd: $(LIGHTNINGD_OBJS) $(LIGHTNINGD_OLD_OBJS) $(LIGHTNINGD_OLD_LIB_OBJS) $(LIGHTNINGD_LIB_OBJS) $(LIGHTNINGD_JSMN_OBJS) $(CORE_OBJS) $(CORE_TX_OBJS) $(BITCOIN_OBJS) $(WIRE_OBJS) $(WIRE_ONION_OBJS) $(CCAN_OBJS) $(CCAN_SHACHAIN48_OBJ) $(LIGHTNINGD_HSM_CONTROL_OBJS) $(LIGHTNINGD_HANDSHAKE_CONTROL_OBJS) $(LIGHTNINGD_GOSSIP_CONTROL_OBJS) $(LIBBASE58_OBJS) $(LIGHTNINGD_OPENING_CONTROL_OBJS) $(LIGHTNINGD_CHANNEL_CONTROL_OBJS) libsecp256k1.a libsodium.a libwallycore.a
+lightningd/lightningd: $(LIGHTNINGD_OBJS) $(LIGHTNINGD_OLD_OBJS) $(LIGHTNINGD_OLD_LIB_OBJS) $(LIGHTNINGD_LIB_OBJS) $(LIGHTNINGD_JSMN_OBJS) $(CORE_OBJS) $(CORE_TX_OBJS) $(BITCOIN_OBJS) $(WIRE_OBJS) $(WIRE_ONION_OBJS) $(CCAN_OBJS) $(CCAN_SHACHAIN48_OBJ) $(LIGHTNINGD_HSM_CONTROL_OBJS) $(LIGHTNINGD_HANDSHAKE_CONTROL_OBJS) $(LIGHTNINGD_GOSSIP_CONTROL_OBJS) $(LIBBASE58_OBJS) $(LIGHTNINGD_OPENING_CONTROL_OBJS) $(LIGHTNINGD_CHANNEL_CONTROL_OBJS) $(WALLET_LIB_OBJS) libsecp256k1.a libsodium.a libwallycore.a
 
 clean: lightningd-clean
 
diff --git a/lightningd/lightningd.c b/lightningd/lightningd.c
index e642ea851..48d84d86d 100644
--- a/lightningd/lightningd.c
+++ b/lightningd/lightningd.c
@@ -254,6 +254,9 @@ int main(int argc, char *argv[])
 	/* Make sure we can reach other daemons, and versions match. */
 	test_daemons(ld);
 
+	/* Initialize wallet, now that we are in the correct directory */
+	ld->wallet = wallet_new(ld, ld->log);
+
 	/* Mark ourselves live. */
 	log_info(ld->log, "Hello world from %s!", version());
 
diff --git a/lightningd/lightningd.h b/lightningd/lightningd.h
index ca281ce57..2e2fbc993 100644
--- a/lightningd/lightningd.h
+++ b/lightningd/lightningd.h
@@ -5,6 +5,7 @@
 #include <ccan/container_of/container_of.h>
 #include <daemon/lightningd.h>
 #include <lightningd/htlc_end.h>
+#include <wallet/wallet.h>
 
 /* BOLT #1:
  *
@@ -60,6 +61,8 @@ struct lightningd {
 	struct htlc_end_map htlc_ends;
 
 	u32 broadcast_interval;
+
+	struct wallet *wallet;
 };
 
 void derive_peer_seed(struct lightningd *ld, struct privkey *peer_seed,
diff --git a/wallet/Makefile b/wallet/Makefile
index 9d468d0ec..8b648489c 100644
--- a/wallet/Makefile
+++ b/wallet/Makefile
@@ -6,8 +6,9 @@ wallet-wrongdir:
 
 check: wallet/tests
 
-WALLET_LIB_SRC :=					\
-	wallet/db.c
+WALLET_LIB_SRC :=	\
+	wallet/db.c	\
+	wallet/wallet.c
 
 WALLET_LIB_OBJS := $(WALLET_LIB_SRC:.c=.o)
 WALLET_LIB_HEADERS := $(WALLET_LIB_SRC:.c=.h)
diff --git a/wallet/db.c b/wallet/db.c
index e565bd978..771cafdfd 100644
--- a/wallet/db.c
+++ b/wallet/db.c
@@ -14,7 +14,7 @@ char *dbmigrations[] = {
     "CREATE TABLE version (version INTEGER)",
     "INSERT INTO version VALUES (1)",
     "CREATE TABLE outputs ( \
-       prev_out_tx BLOB,			 \
+       prev_out_tx CHAR(64),			 \
        prev_out_index INTEGER,			 \
        value INTEGER,				 \
        type INTEGER,				 \
diff --git a/wallet/wallet.c b/wallet/wallet.c
new file mode 100644
index 000000000..d593d4e7c
--- /dev/null
+++ b/wallet/wallet.c
@@ -0,0 +1,27 @@
+#include "wallet.h"
+
+struct wallet *wallet_new(const tal_t *ctx, struct log *log)
+{
+	struct wallet *wallet = tal(ctx, struct wallet);
+	wallet->db = db_setup(wallet);
+	wallet->log = log;
+	if (!wallet->db) {
+		fatal("Unable to setup the wallet database");
+	}
+	return wallet;
+}
+
+bool wallet_add_utxo(struct wallet *w, struct utxo *utxo,
+		     enum wallet_output_type type)
+{
+	tal_t *tmpctx = tal_tmpctx(w);
+	char *hextxid = tal_hexstr(tmpctx, &utxo->txid, 32);
+	bool result = db_exec(
+	    __func__, w->db,
+	    "INSERT INTO outputs (prev_out_tx, prev_out_index, value, type, "
+	    "status, keyindex) VALUES ('%s', %d, %zu, %d, %d, %d);",
+	    hextxid, utxo->outnum, utxo->amount, type, output_state_available,
+	    utxo->keyindex);
+	tal_free(tmpctx);
+	return result;
+}
diff --git a/wallet/wallet.h b/wallet/wallet.h
new file mode 100644
index 000000000..d2630bd54
--- /dev/null
+++ b/wallet/wallet.h
@@ -0,0 +1,53 @@
+#ifndef WALLET_WALLET_H
+#define WALLET_WALLET_H
+
+#include "config.h"
+#include "db.h"
+#include <ccan/tal/tal.h>
+#include <lightningd/utxo.h>
+
+struct wallet {
+	struct db *db;
+	struct log *log;
+};
+
+/* Possible states for tracked outputs in the database. Not sure yet
+ * whether we really want to have reservations reflected in the
+ * database, it would simplify queries at the cost of some IO ops */
+enum output_status {
+	output_state_available= 0,
+	output_state_reserved = 1,
+	output_state_spent = 2,
+	/* Special status used to express that we don't care in
+	 * queries */
+	output_state_any = 255
+};
+
+/* Enumeration of all known output types. These include all types that
+ * could ever end up on-chain and we may need to react upon. Notice
+ * that `to_local`, `htlc_offer`, and `htlc_recv` may need immediate
+ * action since they are encumbered with a CSV. */
+enum wallet_output_type {
+	p2sh_wpkh = 0,
+	to_local = 1,
+	htlc_offer = 3,
+	htlc_recv = 4
+};
+
+/**
+ * wallet_new - Constructor for a new sqlite3 based wallet
+ *
+ * This is guaranteed to either return a valid wallet, or abort with
+ * `fatal` if it cannot be initialized.
+ */
+struct wallet *wallet_new(const tal_t *ctx, struct log *log);
+
+/**
+ * wallet_add_utxo - Register a UTXO which we (partially) own
+ *
+ * Add a UTXO to the set of outputs we care about.
+ */
+bool wallet_add_utxo(struct wallet *w, struct utxo *utxo,
+		     enum wallet_output_type type);
+
+#endif /* WALLET_WALLET_H */