diff --git a/tests/systemtests/README.md b/tests/systemtests/README.md
index ab20d155f08f..61eaf89d0223 100644
--- a/tests/systemtests/README.md
+++ b/tests/systemtests/README.md
@@ -3,19 +3,23 @@
 Test framework for system tests. 
 Starts and interacts with a (multi node) blockchain in Go.
 Supports
+
 * CLI
 * Servers
 * Events
 * RPC
 
 Uses:
+
 * testify
 * gjson
 * sjson
 Server and client side are executed on the host machine
 
 ## Developer
+
 ### Test strategy
+
 System tests cover the full stack via cli and a running (multi node) network. They are more expensive (in terms of time/ cpu) 
 to run compared to unit or integration tests. 
 Therefore, we focus on the **critical path** and do not cover every condition.
@@ -33,7 +37,9 @@ Test cli parameters
 * `-nodes-count` int - number of nodes in the cluster (default 4)
 
 # Port ranges
+
 With *n* nodes:
+
 * `26657` - `26657+n` - RPC
 * `1317` - `1317+n` - API
 * `9090` - `9090+n` - GRPC
@@ -47,4 +53,4 @@ For example Node *3* listens on `26660` for RPC calls
 
 ## Disclaimer
 
-This is based on the system test framework in [wasmd](https://github.com/CosmWasm/wasmd) built by Confio.
\ No newline at end of file
+This is based on the system test framework in [wasmd](https://github.com/CosmWasm/wasmd) built by Confio.
diff --git a/tests/systemtests/account_test.go b/tests/systemtests/account_test.go
new file mode 100644
index 000000000000..c3940579e2c3
--- /dev/null
+++ b/tests/systemtests/account_test.go
@@ -0,0 +1,50 @@
+package systemtests
+
+import (
+	"strings"
+	"testing"
+
+	"github.com/stretchr/testify/assert"
+	"github.com/tidwall/gjson"
+)
+
+func TestAccountCreation(t *testing.T) {
+	// scenario: test account creation
+	// given a running chain
+	// when accountA is sending funds to accountB,
+	// AccountB should not be created
+	// when accountB is sending funds to accountA,
+	// AccountB should be created
+
+	sut.ResetChain(t)
+	cli := NewCLIWrapper(t, sut, verbose)
+	// add genesis account with some tokens
+	account1Addr := cli.AddKey("account1")
+	account2Addr := cli.AddKey("account2")
+	sut.ModifyGenesisCLI(t,
+		[]string{"genesis", "add-genesis-account", account1Addr, "10000000stake"},
+	)
+
+	sut.StartChain(t)
+
+	// query account1
+	rsp := cli.CustomQuery("q", "auth", "account", account1Addr)
+	assert.Equal(t, account1Addr, gjson.Get(rsp, "account.value.address").String(), rsp)
+
+	rsp1 := cli.Run("tx", "bank", "send", account1Addr, account2Addr, "5000stake", "--from="+account1Addr, "--fees=1stake")
+	RequireTxSuccess(t, rsp1)
+
+	// query account2
+
+	rsp2 := cli.WithRunErrorsIgnored().CustomQuery("q", "auth", "account", account2Addr)
+	assert.True(t, strings.Contains(rsp2, "not found: key not found"))
+
+	rsp3 := cli.Run("tx", "bank", "send", account2Addr, account1Addr, "1000stake", "--from="+account1Addr, "--fees=1stake")
+	RequireTxSuccess(t, rsp3)
+
+	// query account2 to make sure its created
+	rsp4 := cli.CustomQuery("q", "auth", "account", account2Addr)
+	assert.Equal(t, "1", gjson.Get(rsp4, "account.value.sequence").String(), rsp4)
+	rsp5 := cli.CustomQuery("q", "auth", "account", account1Addr)
+	assert.Equal(t, "1", gjson.Get(rsp5, "account.value.sequence").String(), rsp5)
+}