diff --git a/Makefile b/Makefile
index 1f17bd7ce..cb5a3d3d0 100644
--- a/Makefile
+++ b/Makefile
@@ -19,7 +19,7 @@ push-tag:
 	git push origin ${VERSION}
 
 run: build
-	./bin/neo-go node -config-path ./config -${NETMODE} --debug
+	./bin/neo-go node -config-path ./config -${NETMODE}
 
 test:
 	@go test ./... -cover
diff --git a/VERSION b/VERSION
index 9b0025a78..d0a191543 100644
--- a/VERSION
+++ b/VERSION
@@ -1 +1 @@
-0.40.0
+0.40.1
diff --git a/pkg/core/blockchain.go b/pkg/core/blockchain.go
index 1b61cf5d1..f114f482a 100644
--- a/pkg/core/blockchain.go
+++ b/pkg/core/blockchain.go
@@ -24,7 +24,7 @@ const (
 var (
 	genAmount         = []int{8, 7, 6, 5, 4, 3, 2, 1, 1, 1, 1, 1, 1, 1, 1, 1, 1, 1, 1, 1, 1, 1}
 	decrementInterval = 2000000
-	persistInterval   = 5 * time.Second
+	persistInterval   = 1 * time.Second
 )
 
 // Blockchain represents the blockchain.
@@ -164,13 +164,6 @@ func (bc *Blockchain) run() {
 	}
 }
 
-// For now this will return a hardcoded hash of the NEO governing token.
-func (bc *Blockchain) governingToken() util.Uint256 {
-	neoNativeAsset := "c56f33fc6ecfcd0c225c4ab356fee59390af8560be0e930faebe74a6daff7c9b"
-	val, _ := util.Uint256DecodeString(neoNativeAsset)
-	return val
-}
-
 // AddBlock processes the given block and will add it to the cache so it
 // can be persisted.
 func (bc *Blockchain) AddBlock(block *Block) error {
@@ -299,10 +292,6 @@ func (bc *Blockchain) persistBlock(block *Block) error {
 			} else {
 				account.Balances[output.AssetID] = output.Amount
 			}
-
-			if output.AssetID.Equals(bc.governingToken()) && len(account.Votes) > 0 {
-				// TODO
-			}
 		}
 
 		// Process TX inputs that are grouped by previous hash.
@@ -324,10 +313,6 @@ func (bc *Blockchain) persistBlock(block *Block) error {
 					return err
 				}
 
-				if prevTXOutput.AssetID.Equals(bc.governingToken()) {
-					// TODO
-				}
-
 				account.Balances[prevTXOutput.AssetID] -= prevTXOutput.Amount
 			}
 		}
@@ -367,6 +352,10 @@ func (bc *Blockchain) persist() (err error) {
 		lenCache  = bc.blockCache.Len()
 	)
 
+	if lenCache == 0 {
+		return nil
+	}
+
 	bc.headersOp <- func(headerList *HeaderHashList) {
 		for i := 0; i < lenCache; i++ {
 			if uint32(headerList.Len()) <= bc.BlockHeight() {
diff --git a/pkg/network/helper_test.go b/pkg/network/helper_test.go
index c007cddf3..8d3c6c7a1 100644
--- a/pkg/network/helper_test.go
+++ b/pkg/network/helper_test.go
@@ -53,10 +53,6 @@ func (d testDiscovery) BadPeers() []string         { return []string{} }
 
 type localTransport struct{}
 
-func (t localTransport) Consumer() <-chan protoTuple {
-	ch := make(chan protoTuple)
-	return ch
-}
 func (t localTransport) Dial(addr string, timeout time.Duration) error {
 	return nil
 }
@@ -85,8 +81,9 @@ func (p *localPeer) Endpoint() util.Endpoint {
 	return p.endpoint
 }
 func (p *localPeer) Disconnect(err error) {}
-func (p *localPeer) Send(msg *Message) {
+func (p *localPeer) WriteMsg(msg *Message) error {
 	p.messageHandler(p.t, msg)
+	return nil
 }
 func (p *localPeer) Done() chan error {
 	done := make(chan error)
@@ -95,6 +92,9 @@ func (p *localPeer) Done() chan error {
 func (p *localPeer) Version() *payload.Version {
 	return p.version
 }
+func (p *localPeer) SetVersion(v *payload.Version) {
+	p.version = v
+}
 
 func newTestServer() *Server {
 	return &Server{
diff --git a/pkg/network/peer.go b/pkg/network/peer.go
index bcaddd8e2..e3b6f3854 100644
--- a/pkg/network/peer.go
+++ b/pkg/network/peer.go
@@ -8,7 +8,8 @@ import (
 type Peer interface {
 	Endpoint() util.Endpoint
 	Disconnect(error)
-	Send(msg *Message)
+	WriteMsg(msg *Message) error
 	Done() chan error
 	Version() *payload.Version
+	SetVersion(*payload.Version)
 }
diff --git a/pkg/network/server.go b/pkg/network/server.go
index c92f50f84..525ef2f91 100644
--- a/pkg/network/server.go
+++ b/pkg/network/server.go
@@ -47,13 +47,6 @@ type (
 		register   chan Peer
 		unregister chan peerDrop
 		quit       chan struct{}
-
-		proto <-chan protoTuple
-	}
-
-	protoTuple struct {
-		msg  *Message
-		peer Peer
 	}
 
 	peerDrop struct {
@@ -75,7 +68,6 @@ func NewServer(config ServerConfig, chain *core.Blockchain) *Server {
 	}
 
 	s.transport = NewTCPTransport(s, fmt.Sprintf(":%d", config.ListenTCP))
-	s.proto = s.transport.Consumer()
 	s.discovery = NewDefaultDiscovery(
 		s.DialTimeout,
 		s.transport,
@@ -96,8 +88,14 @@ func (s *Server) Start(errChan chan error) {
 		"headerHeight": s.chain.HeaderHeight(),
 	}).Info("node started")
 
+	for _, addr := range s.Seeds {
+		if err := s.transport.Dial(addr, s.DialTimeout); err != nil {
+			log.Warnf("failed to connect to remote node %s", addr)
+			continue
+		}
+	}
+
 	go s.transport.Accept()
-	s.discovery.BackFill(s.Seeds...)
 	s.run()
 }
 
@@ -112,34 +110,17 @@ func (s *Server) Shutdown() {
 // UnconnectedPeers returns a list of peers that are in the discovery peer list
 // but are not connected to the server.
 func (s *Server) UnconnectedPeers() []string {
-	return s.discovery.UnconnectedPeers()
+	return []string{}
 }
 
 // BadPeers returns a list of peers the are flagged as "bad" peers.
 func (s *Server) BadPeers() []string {
-	return s.discovery.BadPeers()
+	return []string{}
 }
 
 func (s *Server) run() {
-	// Ask discovery to connect with remote nodes to fill up
-	// the server minimum peer slots.
-	s.discovery.RequestRemote(minPeers - s.PeerCount())
-
 	for {
 		select {
-		case proto := <-s.proto:
-			if err := s.processProto(proto); err != nil {
-				proto.peer.Disconnect(err)
-				// verack and version implies that the protocol is
-				// not started and the only way to disconnect them
-				// from the server is to manually call unregister.
-				switch proto.msg.CommandType() {
-				case CMDVerack, CMDVersion:
-					go func() {
-						s.unregister <- peerDrop{proto.peer, err}
-					}()
-				}
-			}
 		case <-s.quit:
 			s.transport.Close()
 			for p := range s.peers {
@@ -154,7 +135,6 @@ func (s *Server) run() {
 				"endpoint": p.Endpoint(),
 			}).Info("new peer connected")
 		case drop := <-s.unregister:
-			s.discovery.RegisterBadAddr(drop.peer.Endpoint().String())
 			delete(s.peers, drop.peer)
 			log.WithFields(log.Fields{
 				"endpoint":  drop.peer.Endpoint(),
@@ -189,7 +169,6 @@ func (s *Server) startProtocol(p Peer) {
 	}).Info("started protocol")
 
 	s.requestHeaders(p)
-	s.requestPeerInfo(p)
 
 	timer := time.NewTimer(s.ProtoTickInterval)
 	for {
@@ -202,18 +181,13 @@ func (s *Server) startProtocol(p Peer) {
 			if p.Version().StartHeight > s.chain.BlockHeight() {
 				s.requestBlocks(p)
 			}
-			// If the discovery does not have a healthy address pool
-			// we will ask for a new batch of addresses.
-			if s.discovery.PoolCount() < minPoolCount {
-				s.requestPeerInfo(p)
-			}
 			timer.Reset(s.ProtoTickInterval)
 		}
 	}
 }
 
 // When a peer connects to the server, we will send our version immediately.
-func (s *Server) sendVersion(p Peer) {
+func (s *Server) sendVersion(p Peer) error {
 	payload := payload.NewVersion(
 		s.id,
 		s.ListenTCP,
@@ -221,7 +195,7 @@ func (s *Server) sendVersion(p Peer) {
 		s.chain.BlockHeight(),
 		s.Relay,
 	)
-	p.Send(NewMessage(s.Net, CMDVersion, payload))
+	return p.WriteMsg(NewMessage(s.Net, CMDVersion, payload))
 }
 
 // When a peer sends out his version we reply with verack after validating
@@ -233,8 +207,8 @@ func (s *Server) handleVersionCmd(p Peer, version *payload.Version) error {
 	if s.id == version.Nonce {
 		return errIdenticalID
 	}
-	p.Send(NewMessage(s.Net, CMDVerack, nil))
-	return nil
+	p.SetVersion(version)
+	return p.WriteMsg(NewMessage(s.Net, CMDVerack, nil))
 }
 
 // handleHeadersCmd will process the headers it received from its peer.
@@ -268,12 +242,7 @@ func (s *Server) handleInvCmd(p Peer, inv *payload.Inventory) error {
 		return errInvalidInvType
 	}
 	payload := payload.NewInventory(inv.Type, inv.Hashes)
-	p.Send(NewMessage(s.Net, CMDGetData, payload))
-	return nil
-}
-
-func (s *Server) handleGetHeadersCmd(p Peer, getHeaders *payload.GetBlocks) error {
-	log.Info(getHeaders)
+	p.WriteMsg(NewMessage(s.Net, CMDGetData, payload))
 	return nil
 }
 
@@ -282,13 +251,7 @@ func (s *Server) handleGetHeadersCmd(p Peer, getHeaders *payload.GetBlocks) erro
 func (s *Server) requestHeaders(p Peer) {
 	start := []util.Uint256{s.chain.CurrentHeaderHash()}
 	payload := payload.NewGetBlocks(start, util.Uint256{})
-	p.Send(NewMessage(s.Net, CMDGetHeaders, payload))
-}
-
-// requestPeerInfo will send a getaddr message to the peer
-// which will respond with his known addresses in the network.
-func (s *Server) requestPeerInfo(p Peer) {
-	p.Send(NewMessage(s.Net, CMDGetAddr, nil))
+	p.WriteMsg(NewMessage(s.Net, CMDGetHeaders, payload))
 }
 
 // requestBlocks will send a getdata message to the peer
@@ -307,19 +270,14 @@ func (s *Server) requestBlocks(p Peer) {
 	}
 	if len(hashes) > 0 {
 		payload := payload.NewInventory(payload.BlockType, hashes)
-		p.Send(NewMessage(s.Net, CMDGetData, payload))
+		p.WriteMsg(NewMessage(s.Net, CMDGetData, payload))
 	} else if s.chain.HeaderHeight() < p.Version().StartHeight {
 		s.requestHeaders(p)
 	}
 }
 
-// process the received protocol message.
-func (s *Server) processProto(proto protoTuple) error {
-	var (
-		peer = proto.peer
-		msg  = proto.msg
-	)
-
+// handleMessage will process the given message.
+func (s *Server) handleMessage(peer Peer, msg *Message) error {
 	// Make sure both server and peer are operating on
 	// the same network.
 	if msg.Magic != s.Net {
@@ -339,9 +297,6 @@ func (s *Server) processProto(proto protoTuple) error {
 	case CMDBlock:
 		block := msg.Payload.(*core.Block)
 		return s.handleBlockCmd(peer, block)
-	case CMDGetHeaders:
-		getHeaders := msg.Payload.(*payload.GetBlocks)
-		s.handleGetHeadersCmd(peer, getHeaders)
 	case CMDVerack:
 		// Make sure this peer has send his version before we start the
 		// protocol with that peer.
@@ -349,11 +304,6 @@ func (s *Server) processProto(proto protoTuple) error {
 			return errInvalidHandshake
 		}
 		go s.startProtocol(peer)
-	case CMDAddr:
-		addressList := msg.Payload.(*payload.AddressList)
-		for _, addr := range addressList.Addrs {
-			s.discovery.BackFill(addr.Endpoint.String())
-		}
 	}
 	return nil
 }
diff --git a/pkg/network/server_test.go b/pkg/network/server_test.go
index dba204c55..0db4d31ab 100644
--- a/pkg/network/server_test.go
+++ b/pkg/network/server_test.go
@@ -31,19 +31,6 @@ func TestSendVersion(t *testing.T) {
 	s.sendVersion(p)
 }
 
-func TestRequestPeerInfo(t *testing.T) {
-	var (
-		s = newTestServer()
-		p = newLocalPeer(t)
-	)
-
-	p.messageHandler = func(t *testing.T, msg *Message) {
-		assert.Equal(t, CMDGetAddr, msg.CommandType())
-		assert.Nil(t, msg.Payload)
-	}
-	s.requestPeerInfo(p)
-}
-
 // Server should reply with a verack after receiving a valid version.
 func TestVerackAfterHandleVersionCmd(t *testing.T) {
 	var (
@@ -89,18 +76,6 @@ func TestServerNotSendsVerack(t *testing.T) {
 	assert.Equal(t, errIdenticalID, err)
 }
 
-func TestRequestPeers(t *testing.T) {
-	var (
-		s = newTestServer()
-		p = newLocalPeer(t)
-	)
-	p.messageHandler = func(t *testing.T, msg *Message) {
-		assert.Nil(t, msg.Payload)
-		assert.Equal(t, CMDGetAddr, msg.CommandType())
-	}
-	s.requestPeerInfo(p)
-}
-
 func TestRequestHeaders(t *testing.T) {
 	var (
 		s = newTestServer()
diff --git a/pkg/network/tcp_peer.go b/pkg/network/tcp_peer.go
index de80778dc..6d3cca187 100644
--- a/pkg/network/tcp_peer.go
+++ b/pkg/network/tcp_peer.go
@@ -18,31 +18,27 @@ type TCPPeer struct {
 	// The version of the peer.
 	version *payload.Version
 
-	done   chan error
-	closed chan struct{}
-	disc   chan error
+	done chan error
 
 	wg sync.WaitGroup
 }
 
-func NewTCPPeer(conn net.Conn, proto chan protoTuple) *TCPPeer {
+func NewTCPPeer(conn net.Conn) *TCPPeer {
 	return &TCPPeer{
 		conn:     conn,
-		done:     make(chan error),
-		closed:   make(chan struct{}),
-		disc:     make(chan error),
+		done:     make(chan error, 1),
 		endpoint: util.NewEndpoint(conn.RemoteAddr().String()),
 	}
 }
 
-// Send implements the Peer interface. This will encode the message
+// WriteMsg implements the Peer interface. This will write/encode the message
 // to the underlying connection.
-func (p *TCPPeer) Send(msg *Message) {
-	if err := msg.Encode(p.conn); err != nil {
-		select {
-		case p.disc <- err:
-		case <-p.closed:
-		}
+func (p *TCPPeer) WriteMsg(msg *Message) error {
+	select {
+	case err := <-p.done:
+		return err
+	default:
+		return msg.Encode(p.conn)
 	}
 }
 
@@ -58,71 +54,17 @@ func (p *TCPPeer) Done() chan error {
 	return p.done
 }
 
+// Disconnect will fill the peer's done channel with the given error.
+func (p *TCPPeer) Disconnect(err error) {
+	p.done <- err
+}
+
 // Version implements the Peer interface.
 func (p *TCPPeer) Version() *payload.Version {
 	return p.version
 }
 
-func (p *TCPPeer) readLoop(proto chan protoTuple, readErr chan error) {
-	defer p.wg.Done()
-	for {
-		select {
-		case <-p.closed:
-			return
-		default:
-			msg := &Message{}
-			if err := msg.Decode(p.conn); err != nil {
-				readErr <- err
-				return
-			}
-			p.handleMessage(msg, proto)
-		}
-	}
-}
-
-func (p *TCPPeer) handleMessage(msg *Message, proto chan protoTuple) {
-	switch payload := msg.Payload.(type) {
-	case *payload.Version:
-		p.version = payload
-	}
-	proto <- protoTuple{
-		msg:  msg,
-		peer: p,
-	}
-}
-
-func (p *TCPPeer) run(proto chan protoTuple) {
-	var (
-		readErr = make(chan error, 1)
-		err     error
-	)
-	p.wg.Add(1)
-	go p.readLoop(proto, readErr)
-
-run:
-	for {
-		select {
-		case err = <-p.disc:
-			break run
-		case err = <-readErr:
-			break run
-		}
-	}
-
-	// If the peer has not started the protocol with the server
-	// there will be noone reading from this channel.
-	select {
-	case p.done <- err:
-	default:
-	}
-
-	close(p.closed)
-	p.conn.Close()
-	p.wg.Wait()
-	return
-}
-
-// Disconnect implements the Peer interface.
-func (p *TCPPeer) Disconnect(reason error) {
-	p.disc <- reason
+// SetVersion implements the Peer interface.
+func (p *TCPPeer) SetVersion(v *payload.Version) {
+	p.version = v
 }
diff --git a/pkg/network/tcp_transport.go b/pkg/network/tcp_transport.go
index 915440b2c..a9c1b4cd3 100644
--- a/pkg/network/tcp_transport.go
+++ b/pkg/network/tcp_transport.go
@@ -13,7 +13,6 @@ type TCPTransport struct {
 	server   *Server
 	listener net.Listener
 	bindAddr string
-	proto    chan protoTuple
 }
 
 // NewTCPTransport return a new TCPTransport that will listen for
@@ -22,15 +21,9 @@ func NewTCPTransport(s *Server, bindAddr string) *TCPTransport {
 	return &TCPTransport{
 		server:   s,
 		bindAddr: bindAddr,
-		proto:    make(chan protoTuple),
 	}
 }
 
-// Consumer implements the Transporter interface.
-func (t *TCPTransport) Consumer() <-chan protoTuple {
-	return t.proto
-}
-
 // Dial implements the Transporter interface.
 func (t *TCPTransport) Dial(addr string, timeout time.Duration) error {
 	conn, err := net.DialTimeout("tcp", addr, timeout)
@@ -58,7 +51,6 @@ func (t *TCPTransport) Accept() {
 			if t.isCloseError(err) {
 				break
 			}
-
 			continue
 		}
 		go t.handleConn(conn)
@@ -81,11 +73,26 @@ func (t *TCPTransport) isCloseError(err error) bool {
 }
 
 func (t *TCPTransport) handleConn(conn net.Conn) {
-	p := NewTCPPeer(conn, t.proto)
+	var (
+		p   = NewTCPPeer(conn)
+		err error
+	)
+
+	defer func() {
+		p.Disconnect(err)
+	}()
+
 	t.server.register <- p
-	// This will block until the peer is stopped running.
-	p.run(t.proto)
-	log.Warnf("TCP released peer: %s", p.Endpoint())
+
+	for {
+		msg := &Message{}
+		if err = msg.Decode(p.conn); err != nil {
+			return
+		}
+		if err = t.server.handleMessage(p, msg); err != nil {
+			return
+		}
+	}
 }
 
 // Close implements the Transporter interface.
diff --git a/pkg/network/transport.go b/pkg/network/transport.go
index dd0113fd5..684f86717 100644
--- a/pkg/network/transport.go
+++ b/pkg/network/transport.go
@@ -5,7 +5,6 @@ import "time"
 // Transporter is an interface that allows us to abstract
 // any form of communication between the server and its peers.
 type Transporter interface {
-	Consumer() <-chan protoTuple
 	Dial(addr string, timeout time.Duration) error
 	Accept()
 	Proto() string