diff --git a/abci/example/kvstore/helpers.go b/abci/example/kvstore/helpers.go
index d1334b312..e59fee279 100644
--- a/abci/example/kvstore/helpers.go
+++ b/abci/example/kvstore/helpers.go
@@ -10,7 +10,7 @@ import (
 func RandVal(i int) types.ValidatorUpdate {
 	pubkey := tmrand.Bytes(32)
 	power := tmrand.Uint16() + 1
-	v := types.Ed25519ValidatorUpdate(pubkey, int64(power))
+	v := types.UpdateValidator(pubkey, int64(power), "")
 	return v
 }
 
diff --git a/abci/example/kvstore/persistent_kvstore.go b/abci/example/kvstore/persistent_kvstore.go
index c2232cc77..320918b5b 100644
--- a/abci/example/kvstore/persistent_kvstore.go
+++ b/abci/example/kvstore/persistent_kvstore.go
@@ -238,7 +238,7 @@ func (app *PersistentKVStoreApplication) execValidatorTx(tx []byte) types.Respon
 	}
 
 	// update
-	return app.updateValidator(types.Ed25519ValidatorUpdate(pubkey, power))
+	return app.updateValidator(types.UpdateValidator(pubkey, power, ""))
 }
 
 // add, update, or remove a validator
diff --git a/abci/tests/server/client.go b/abci/tests/server/client.go
index 36989f6ac..beaa3da89 100644
--- a/abci/tests/server/client.go
+++ b/abci/tests/server/client.go
@@ -16,7 +16,7 @@ func InitChain(client abcicli.Client) error {
 	for i := 0; i < total; i++ {
 		pubkey := tmrand.Bytes(33)
 		power := tmrand.Int()
-		vals[i] = types.Ed25519ValidatorUpdate(pubkey, int64(power))
+		vals[i] = types.UpdateValidator(pubkey, int64(power), "")
 	}
 	_, err := client.InitChainSync(types.RequestInitChain{
 		Validators: vals,
diff --git a/abci/types/pubkey.go b/abci/types/pubkey.go
index aaff6debb..8530d9538 100644
--- a/abci/types/pubkey.go
+++ b/abci/types/pubkey.go
@@ -1,16 +1,16 @@
 package types
 
 import (
+	fmt "fmt"
+
 	"github.com/tendermint/tendermint/crypto/ed25519"
 	cryptoenc "github.com/tendermint/tendermint/crypto/encoding"
-)
-
-const (
-	PubKeyEd25519 = "ed25519"
+	"github.com/tendermint/tendermint/crypto/secp256k1"
 )
 
 func Ed25519ValidatorUpdate(pk []byte, power int64) ValidatorUpdate {
 	pke := ed25519.PubKey(pk)
+
 	pkp, err := cryptoenc.PubKeyToProto(pke)
 	if err != nil {
 		panic(err)
@@ -22,3 +22,23 @@ func Ed25519ValidatorUpdate(pk []byte, power int64) ValidatorUpdate {
 		Power:  power,
 	}
 }
+
+func UpdateValidator(pk []byte, power int64, keyType string) ValidatorUpdate {
+	switch keyType {
+	case "", ed25519.KeyType:
+		return Ed25519ValidatorUpdate(pk, power)
+	case secp256k1.KeyType:
+		pke := secp256k1.PubKey(pk)
+		pkp, err := cryptoenc.PubKeyToProto(pke)
+		if err != nil {
+			panic(err)
+		}
+		return ValidatorUpdate{
+			// Address:
+			PubKey: pkp,
+			Power:  power,
+		}
+	default:
+		panic(fmt.Sprintf("key type %s not supported", keyType))
+	}
+}
diff --git a/crypto/encoding/codec.go b/crypto/encoding/codec.go
index f9c721131..3c552ed23 100644
--- a/crypto/encoding/codec.go
+++ b/crypto/encoding/codec.go
@@ -51,7 +51,7 @@ func PubKeyFromProto(k pc.PublicKey) (crypto.PubKey, error) {
 		return pk, nil
 	case *pc.PublicKey_Secp256K1:
 		if len(k.Secp256K1) != secp256k1.PubKeySize {
-			return nil, fmt.Errorf("invalid size for PubKeyEd25519. Got %d, expected %d",
+			return nil, fmt.Errorf("invalid size for PubKeySecp256k1. Got %d, expected %d",
 				len(k.Secp256K1), secp256k1.PubKeySize)
 		}
 		pk := make(secp256k1.PubKey, secp256k1.PubKeySize)
diff --git a/test/e2e/app/app.go b/test/e2e/app/app.go
index 415fc7ad7..13002a708 100644
--- a/test/e2e/app/app.go
+++ b/test/e2e/app/app.go
@@ -193,13 +193,15 @@ func (app *Application) validatorUpdates(height uint64) (abci.ValidatorUpdates,
 	if len(updates) == 0 {
 		return nil, nil
 	}
+
 	valUpdates := abci.ValidatorUpdates{}
 	for keyString, power := range updates {
+
 		keyBytes, err := base64.StdEncoding.DecodeString(keyString)
 		if err != nil {
 			return nil, fmt.Errorf("invalid base64 pubkey value %q: %w", keyString, err)
 		}
-		valUpdates = append(valUpdates, abci.Ed25519ValidatorUpdate(keyBytes, int64(power)))
+		valUpdates = append(valUpdates, abci.UpdateValidator(keyBytes, int64(power), app.cfg.KeyType))
 	}
 	return valUpdates, nil
 }
diff --git a/test/e2e/app/config.go b/test/e2e/app/config.go
index 281419160..38c967916 100644
--- a/test/e2e/app/config.go
+++ b/test/e2e/app/config.go
@@ -22,6 +22,7 @@ type Config struct {
 	PrivValKey       string                      `toml:"privval_key"`
 	PrivValState     string                      `toml:"privval_state"`
 	Misbehaviors     map[string]string           `toml:"misbehaviors"`
+	KeyType          string                      `toml:"key_type"`
 }
 
 // LoadConfig loads the configuration from disk.
diff --git a/test/e2e/pkg/testnet.go b/test/e2e/pkg/testnet.go
index fa559fe61..d4f788dbc 100644
--- a/test/e2e/pkg/testnet.go
+++ b/test/e2e/pkg/testnet.go
@@ -64,7 +64,8 @@ type Node struct {
 	Name             string
 	Testnet          *Testnet
 	Mode             Mode
-	Key              crypto.PrivKey
+	PrivvalKey       crypto.PrivKey
+	NodeKey          crypto.PrivKey
 	IP               net.IP
 	ProxyPort        uint32
 	StartAt          int64
@@ -135,7 +136,8 @@ func LoadTestnet(file string) (*Testnet, error) {
 		node := &Node{
 			Name:             name,
 			Testnet:          testnet,
-			Key:              keyGen.Generate(),
+			PrivvalKey:       keyGen.Generate(manifest.KeyType),
+			NodeKey:          keyGen.Generate("ed25519"),
 			IP:               ipGen.Next(),
 			ProxyPort:        proxyPortGen.Next(),
 			Mode:             ModeValidator,
@@ -435,7 +437,7 @@ func (n Node) AddressP2P(withID bool) string {
 	}
 	addr := fmt.Sprintf("%v:26656", ip)
 	if withID {
-		addr = fmt.Sprintf("%x@%v", n.Key.PubKey().Address().Bytes(), addr)
+		addr = fmt.Sprintf("%x@%v", n.NodeKey.PubKey().Address().Bytes(), addr)
 	}
 	return addr
 }
diff --git a/test/e2e/runner/setup.go b/test/e2e/runner/setup.go
index 8c641d9f6..c1a7502db 100644
--- a/test/e2e/runner/setup.go
+++ b/test/e2e/runner/setup.go
@@ -96,12 +96,12 @@ func Setup(testnet *e2e.Testnet) error {
 			return err
 		}
 
-		err = (&p2p.NodeKey{PrivKey: node.Key}).SaveAs(filepath.Join(nodeDir, "config", "node_key.json"))
+		err = (&p2p.NodeKey{PrivKey: node.NodeKey}).SaveAs(filepath.Join(nodeDir, "config", "node_key.json"))
 		if err != nil {
 			return err
 		}
 
-		(privval.NewFilePV(node.Key,
+		(privval.NewFilePV(node.PrivvalKey,
 			filepath.Join(nodeDir, PrivvalKeyFile),
 			filepath.Join(nodeDir, PrivvalStateFile),
 		)).Save()
@@ -194,8 +194,8 @@ func MakeGenesis(testnet *e2e.Testnet) (types.GenesisDoc, error) {
 	for validator, power := range testnet.Validators {
 		genesis.Validators = append(genesis.Validators, types.GenesisValidator{
 			Name:    validator.Name,
-			Address: validator.Key.PubKey().Address(),
-			PubKey:  validator.Key.PubKey(),
+			Address: validator.PrivvalKey.PubKey().Address(),
+			PubKey:  validator.PrivvalKey.PubKey(),
 			Power:   power,
 		})
 	}
@@ -317,6 +317,7 @@ func MakeAppConfig(node *e2e.Node) ([]byte, error) {
 		"persist_interval":  node.PersistInterval,
 		"snapshot_interval": node.SnapshotInterval,
 		"retain_blocks":     node.RetainBlocks,
+		"key_type":          node.PrivvalKey.Type(),
 	}
 	switch node.ABCIProtocol {
 	case e2e.ProtocolUNIX:
@@ -359,7 +360,7 @@ func MakeAppConfig(node *e2e.Node) ([]byte, error) {
 		for height, validators := range node.Testnet.ValidatorUpdates {
 			updateVals := map[string]int64{}
 			for node, power := range validators {
-				updateVals[base64.StdEncoding.EncodeToString(node.Key.PubKey().Bytes())] = power
+				updateVals[base64.StdEncoding.EncodeToString(node.PrivvalKey.PubKey().Bytes())] = power
 			}
 			validatorUpdates[fmt.Sprintf("%v", height)] = updateVals
 		}
diff --git a/test/e2e/tests/evidence_test.go b/test/e2e/tests/evidence_test.go
index 8abb361c8..ea24b51e5 100644
--- a/test/e2e/tests/evidence_test.go
+++ b/test/e2e/tests/evidence_test.go
@@ -22,7 +22,7 @@ func TestEvidence_Misbehavior(t *testing.T) {
 			for _, evidence := range block.Evidence.Evidence {
 				switch evidence := evidence.(type) {
 				case *types.DuplicateVoteEvidence:
-					if bytes.Equal(evidence.VoteA.ValidatorAddress, node.Key.PubKey().Address()) {
+					if bytes.Equal(evidence.VoteA.ValidatorAddress, node.PrivvalKey.PubKey().Address()) {
 						nodeEvidence = evidence
 					}
 				default:
diff --git a/test/e2e/tests/validator_test.go b/test/e2e/tests/validator_test.go
index 29f63bd92..8a36bb55d 100644
--- a/test/e2e/tests/validator_test.go
+++ b/test/e2e/tests/validator_test.go
@@ -60,7 +60,7 @@ func TestValidator_Propose(t *testing.T) {
 		if node.Mode != e2e.ModeValidator {
 			return
 		}
-		address := node.Key.PubKey().Address()
+		address := node.PrivvalKey.PubKey().Address()
 		valSchedule := newValidatorSchedule(*node.Testnet)
 
 		expectCount := 0
@@ -90,7 +90,7 @@ func TestValidator_Sign(t *testing.T) {
 		if node.Mode != e2e.ModeValidator {
 			return
 		}
-		address := node.Key.PubKey().Address()
+		address := node.PrivvalKey.PubKey().Address()
 		valSchedule := newValidatorSchedule(*node.Testnet)
 
 		expectCount := 0
@@ -160,7 +160,7 @@ func (s *validatorSchedule) Increment(heights int64) {
 func makeVals(valMap map[*e2e.Node]int64) []*types.Validator {
 	vals := make([]*types.Validator, 0, len(valMap))
 	for node, power := range valMap {
-		vals = append(vals, types.NewValidator(node.Key.PubKey(), power))
+		vals = append(vals, types.NewValidator(node.PrivvalKey.PubKey(), power))
 	}
 	return vals
 }