diff --git a/test/functional/test_framework/blocktools.py b/test/functional/test_framework/blocktools.py
--- a/test/functional/test_framework/blocktools.py
+++ b/test/functional/test_framework/blocktools.py
@@ -8,6 +8,7 @@
 from .script import CScript, OP_TRUE, OP_CHECKSIG, OP_RETURN, OP_PUSHDATA2, OP_DUP, OP_HASH160, OP_EQUALVERIFY
 from .mininode import CTransaction, CTxOut, CTxIn
 from .util import satoshi_round
+from .txtools import pad_tx
 
 # Create a block (with regtest difficulty)
 
@@ -62,9 +63,7 @@
     coinbase.vout = [coinbaseoutput]
 
     # Make sure the coinbase is at least 100 bytes
-    coinbase_size = len(coinbase.serialize())
-    if coinbase_size < 100:
-        coinbase.vin[0].scriptSig += b'x' * (100 - coinbase_size)
+    pad_tx(coinbase)
 
     coinbase.calc_sha256()
     return coinbase
@@ -78,6 +77,7 @@
     assert(n < len(prevtx.vout))
     tx.vin.append(CTxIn(COutPoint(prevtx.sha256, n), sig, 0xffffffff))
     tx.vout.append(CTxOut(value, scriptPubKey))
+    pad_tx(tx)
     tx.calc_sha256()
     return tx
 
diff --git a/test/functional/test_framework/cdefs.py b/test/functional/test_framework/cdefs.py
--- a/test/functional/test_framework/cdefs.py
+++ b/test/functional/test_framework/cdefs.py
@@ -88,6 +88,9 @@
 # Minimum size a transaction can have.
 MIN_TX_SIZE = 100
 
+# Maximum bytes in a TxOut pubkey script
+MAX_TXOUT_PUBKEY_SCRIPT = 10000
+
 if __name__ == "__main__":
     # Output values if run standalone to verify
     print("DEFAULT_MAX_BLOCK_SIZE = %d (bytes)" % DEFAULT_MAX_BLOCK_SIZE)
diff --git a/test/functional/test_framework/txtools.py b/test/functional/test_framework/txtools.py
new file mode 100644
--- /dev/null
+++ b/test/functional/test_framework/txtools.py
@@ -0,0 +1,41 @@
+from .cdefs import MIN_TX_SIZE, MAX_TXOUT_PUBKEY_SCRIPT
+from .mininode import CTransaction, FromHex, ToHex, CTxOut
+from .script import OP_RETURN, CScript
+
+import random
+from binascii import hexlify, unhexlify
+
+# Pad outputs until it reaches at least min_size
+
+
+def pad_tx(tx, min_size=None):
+    if min_size is None:
+        min_size = MIN_TX_SIZE
+
+    curr_size = len(tx.serialize())
+
+    while curr_size < min_size:
+        # txout.value + txout.pk_script bytes + op_return
+        extra_bytes = 8 + 1 + 1
+        padding_len = max(0, min_size - curr_size - extra_bytes)
+        padding_len = min(padding_len, MAX_TXOUT_PUBKEY_SCRIPT)
+        if padding_len == 0:
+            tx.vout.append(CTxOut(0, CScript([OP_RETURN])))
+        else:
+            padding = random.randrange(
+                1 << 8 * padding_len - 1, 1 << 8 * padding_len)
+            tx.vout.append(
+                CTxOut(0, CScript([padding, OP_RETURN])))
+        curr_size = len(tx.serialize())
+
+    tx.rehash()
+
+# Pad  outputs until it reaches at least min_size
+
+
+def pad_raw_tx(rawtx_hex, min_size=None):
+
+    tx = CTransaction()
+    FromHex(tx, rawtx_hex)
+    pad_tx(tx, min_size)
+    return ToHex(tx)