diff --git a/src/chainparams.cpp b/src/chainparams.cpp
index 6501af78b..35e090a0b 100644
--- a/src/chainparams.cpp
+++ b/src/chainparams.cpp
@@ -83,6 +83,9 @@ public:
         consensus.fPowNoRetargeting = false;
         consensus.nRuleChangeActivationThreshold = 1916; // 95% of 2016
         consensus.nMinerConfirmationWindow = 2016; // nPowTargetTimespan / nPowTargetSpacing
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].bit = 28;
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nStartTime = 1199145601; // January 1, 2008
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nTimeout = 1230767999; // December 31, 2008
         /** 
          * The message start string is designed to be unlikely to occur in normal data.
          * The characters are rarely used upper ASCII, not valid as UTF-8, and produce
@@ -166,6 +169,9 @@ public:
         consensus.fPowNoRetargeting = false;
         consensus.nRuleChangeActivationThreshold = 1512; // 75% for testchains
         consensus.nMinerConfirmationWindow = 2016; // nPowTargetTimespan / nPowTargetSpacing
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].bit = 28;
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nStartTime = 1199145601; // January 1, 2008
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nTimeout = 1230767999; // December 31, 2008
         pchMessageStart[0] = 0x0b;
         pchMessageStart[1] = 0x11;
         pchMessageStart[2] = 0x09;
@@ -231,6 +237,9 @@ public:
         consensus.fPowNoRetargeting = true;
         consensus.nRuleChangeActivationThreshold = 108; // 75% for testchains
         consensus.nMinerConfirmationWindow = 144; // Faster than normal for regtest (144 instead of 2016)
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].bit = 28;
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nStartTime = 0;
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nTimeout = 999999999999ULL;
 
         pchMessageStart[0] = 0xfa;
         pchMessageStart[1] = 0xbf;
diff --git a/src/consensus/params.h b/src/consensus/params.h
index d5039211a..7c3a8e84c 100644
--- a/src/consensus/params.h
+++ b/src/consensus/params.h
@@ -14,7 +14,8 @@ namespace Consensus {
 
 enum DeploymentPos
 {
-    MAX_VERSION_BITS_DEPLOYMENTS = 0,
+    DEPLOYMENT_TESTDUMMY,
+    MAX_VERSION_BITS_DEPLOYMENTS
 };
 
 /**
diff --git a/src/test/versionbits_tests.cpp b/src/test/versionbits_tests.cpp
index 9de8461d8..63dc4726b 100644
--- a/src/test/versionbits_tests.cpp
+++ b/src/test/versionbits_tests.cpp
@@ -6,6 +6,9 @@
 #include "random.h"
 #include "versionbits.h"
 #include "test/test_bitcoin.h"
+#include "chainparams.h"
+#include "main.h"
+#include "consensus/params.h"
 
 #include <boost/test/unit_test.hpp>
 
@@ -124,6 +127,8 @@ public:
         num++;
         return *this;
     }
+
+    CBlockIndex * Tip() { return vpblock.size() ? vpblock.back() : NULL; }
 };
 
 BOOST_FIXTURE_TEST_SUITE(versionbits_tests, TestingSetup)
@@ -182,4 +187,108 @@ BOOST_AUTO_TEST_CASE(versionbits_test)
     }
 }
 
+BOOST_AUTO_TEST_CASE(versionbits_computeblockversion)
+{
+    // Check that ComputeBlockVersion will set the appropriate bit correctly
+    // on mainnet.
+    const Consensus::Params &mainnetParams = Params(CBaseChainParams::MAIN).GetConsensus();
+
+    // Use the TESTDUMMY deployment for testing purposes.
+    int64_t bit = mainnetParams.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].bit;
+    int64_t nStartTime = mainnetParams.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nStartTime;
+    int64_t nTimeout = mainnetParams.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nTimeout;
+
+    assert(nStartTime < nTimeout);
+
+    // In the first chain, test that the bit is set by CBV until it has failed.
+    // In the second chain, test the bit is set by CBV while STARTED and
+    // LOCKED-IN, and then no longer set while ACTIVE.
+    VersionBitsTester firstChain, secondChain;
+
+    // Start generating blocks before nStartTime
+    int64_t nTime = nStartTime - 1;
+
+    // Before MedianTimePast of the chain has crossed nStartTime, the bit
+    // should not be set.
+    CBlockIndex *lastBlock = NULL;
+    lastBlock = firstChain.Mine(2016, nTime, VERSIONBITS_LAST_OLD_BLOCK_VERSION).Tip();
+    BOOST_CHECK_EQUAL(ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit), 0);
+
+    // Mine 2011 more blocks at the old time, and check that CBV isn't setting the bit yet.
+    for (int i=1; i<2012; i++) {
+        lastBlock = firstChain.Mine(2016+i, nTime, VERSIONBITS_LAST_OLD_BLOCK_VERSION).Tip();
+        // This works because VERSIONBITS_LAST_OLD_BLOCK_VERSION happens
+        // to be 4, and the bit we're testing happens to be bit 28.
+        BOOST_CHECK_EQUAL(ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit), 0);
+    }
+    // Now mine 5 more blocks at the start time -- MTP should not have passed yet, so
+    // CBV should still not yet set the bit.
+    nTime = nStartTime;
+    for (int i=2012; i<=2016; i++) {
+        lastBlock = firstChain.Mine(2016+i, nTime, VERSIONBITS_LAST_OLD_BLOCK_VERSION).Tip();
+        BOOST_CHECK_EQUAL(ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit), 0);
+    }
+
+    // Advance to the next period and transition to STARTED,
+    lastBlock = firstChain.Mine(6048, nTime, VERSIONBITS_LAST_OLD_BLOCK_VERSION).Tip();
+    // so ComputeBlockVersion should now set the bit,
+    BOOST_CHECK((ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit)) != 0);
+    // and should also be using the VERSIONBITS_TOP_BITS.
+    BOOST_CHECK_EQUAL(ComputeBlockVersion(lastBlock, mainnetParams) & VERSIONBITS_TOP_MASK, VERSIONBITS_TOP_BITS);
+
+    // Check that ComputeBlockVersion will set the bit until nTimeout
+    nTime += 600;
+    int blocksToMine = 4032; // test blocks for up to 2 time periods
+    int nHeight = 6048;
+    // These blocks are all before nTimeout is reached.
+    while (nTime < nTimeout && blocksToMine > 0) {
+        lastBlock = firstChain.Mine(nHeight+1, nTime, VERSIONBITS_LAST_OLD_BLOCK_VERSION).Tip();
+        BOOST_CHECK((ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit)) != 0);
+        BOOST_CHECK_EQUAL(ComputeBlockVersion(lastBlock, mainnetParams) & VERSIONBITS_TOP_MASK, VERSIONBITS_TOP_BITS);
+        blocksToMine--;
+        nTime += 600;
+        nHeight += 1;
+    };
+
+    nTime = nTimeout;
+    // FAILED is only triggered at the end of a period, so CBV should be setting
+    // the bit until the period transition.
+    for (int i=0; i<2015; i++) {
+        lastBlock = firstChain.Mine(nHeight+1, nTime, VERSIONBITS_LAST_OLD_BLOCK_VERSION).Tip();
+        BOOST_CHECK((ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit)) != 0);
+        nHeight += 1;
+    }
+    // The next block should trigger no longer setting the bit.
+    lastBlock = firstChain.Mine(nHeight+1, nTime, VERSIONBITS_LAST_OLD_BLOCK_VERSION).Tip();
+    BOOST_CHECK_EQUAL(ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit), 0);
+
+    // On a new chain:
+    // verify that the bit will be set after lock-in, and then stop being set
+    // after activation.
+    nTime = nStartTime;
+
+    // Mine one period worth of blocks, and check that the bit will be on for the
+    // next period.
+    lastBlock = secondChain.Mine(2016, nStartTime, VERSIONBITS_LAST_OLD_BLOCK_VERSION).Tip();
+    BOOST_CHECK((ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit)) != 0);
+
+    // Mine another period worth of blocks, signaling the new bit.
+    lastBlock = secondChain.Mine(4032, nStartTime, VERSIONBITS_TOP_BITS | (1<<bit)).Tip();
+    // After one period of setting the bit on each block, it should have locked in.
+    // We keep setting the bit for one more period though, until activation.
+    BOOST_CHECK((ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit)) != 0);
+
+    // Now check that we keep mining the block until the end of this period, and
+    // then stop at the beginning of the next period.
+    lastBlock = secondChain.Mine(6047, nStartTime, VERSIONBITS_LAST_OLD_BLOCK_VERSION).Tip();
+    BOOST_CHECK((ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit)) != 0);
+    lastBlock = secondChain.Mine(6048, nStartTime, VERSIONBITS_LAST_OLD_BLOCK_VERSION).Tip();
+    BOOST_CHECK_EQUAL(ComputeBlockVersion(lastBlock, mainnetParams) & (1<<bit), 0);
+
+    // Finally, verify that after a soft fork has activated, CBV no longer uses
+    // VERSIONBITS_LAST_OLD_BLOCK_VERSION.
+    //BOOST_CHECK_EQUAL(ComputeBlockVersion(lastBlock, mainnetParams) & VERSIONBITS_TOP_MASK, VERSIONBITS_TOP_BITS);
+}
+
+
 BOOST_AUTO_TEST_SUITE_END()