diff --git a/doc/release-notes.md b/doc/release-notes.md
--- a/doc/release-notes.md
+++ b/doc/release-notes.md
@@ -3,3 +3,12 @@
   <https://download.bitcoinabc.org/0.22.0/>
 
 This release includes the following features and fixes:
+
+RPC changes
+-----------
+
+RPCs which have an `include_watchonly` argument or `includeWatching`
+option now default to `true` for watch-only wallets. Affected RPCs
+are: `getbalance`, `listreceivedbyaddress`, `listreceivedbylabel`,
+`listtransactions`, `listsinceblock`, `gettransaction`,
+`walletcreatefundedpsbt`, and `fundrawtransaction`.
diff --git a/test/functional/test_runner.py b/test/functional/test_runner.py
--- a/test/functional/test_runner.py
+++ b/test/functional/test_runner.py
@@ -98,6 +98,7 @@
     "wallet_txn_clone.py": [["--mineblock"]],
     "wallet_createwallet.py": [["--usecli"]],
     "wallet_multiwallet.py": [["--usecli"]],
+    "wallet_watchonly.py": [["--usecli"]],
 }
 
 # Used to limit the number of tests, when list of tests is not provided on command line
diff --git a/test/functional/wallet_watchonly.py b/test/functional/wallet_watchonly.py
new file mode 100644
--- /dev/null
+++ b/test/functional/wallet_watchonly.py
@@ -0,0 +1,120 @@
+#!/usr/bin/env python3
+# Copyright (c) 2018-2019 The Bitcoin Core developers
+# Distributed under the MIT software license, see the accompanying
+# file COPYING or http://www.opensource.org/licenses/mit-license.php.
+"""Test createwallet arguments.
+"""
+
+from test_framework.test_framework import BitcoinTestFramework
+from test_framework.util import (
+    assert_equal,
+    assert_raises_rpc_error
+)
+
+
+class CreateWalletWatchonlyTest(BitcoinTestFramework):
+    def set_test_params(self):
+        self.setup_clean_chain = False
+        self.num_nodes = 1
+        self.supports_cli = True
+
+    def skip_test_if_missing_module(self):
+        self.skip_if_no_wallet()
+
+    def run_test(self):
+        node = self.nodes[0]
+
+        self.nodes[0].createwallet(wallet_name='default')
+        def_wallet = node.get_wallet_rpc('default')
+
+        a1 = def_wallet.getnewaddress()
+        wo_change = def_wallet.getnewaddress()
+        wo_addr = def_wallet.getnewaddress()
+
+        self.nodes[0].createwallet(wallet_name='wo', disable_private_keys=True)
+        wo_wallet = node.get_wallet_rpc('wo')
+
+        wo_wallet.importpubkey(
+            pubkey=def_wallet.getaddressinfo(wo_addr)['pubkey'])
+        wo_wallet.importpubkey(
+            pubkey=def_wallet.getaddressinfo(wo_change)['pubkey'])
+
+        # generate some btc for testing
+        node.generatetoaddress(101, a1)
+
+        # send 1 btc to our watch-only address
+        txid = def_wallet.sendtoaddress(wo_addr, 1)
+        self.nodes[0].generate(1)
+
+        # getbalance
+        self.log.info(
+            'include_watchonly should default to true for watch-only wallets')
+        self.log.info('Testing getbalance watch-only defaults')
+        assert_equal(wo_wallet.getbalance(), 1)
+        assert_equal(len(wo_wallet.listtransactions()), 1)
+        assert_equal(wo_wallet.getbalance(include_watchonly=False), 0)
+
+        self.log.info('Testing listreceivedbyaddress watch-only defaults')
+        result = wo_wallet.listreceivedbyaddress()
+        assert_equal(len(result), 1)
+        assert_equal(result[0]["involvesWatchonly"], True)
+        result = wo_wallet.listreceivedbyaddress(include_watchonly=False)
+        assert_equal(len(result), 0)
+
+        self.log.info('Testing listreceivedbylabel watch-only defaults')
+        result = wo_wallet.listreceivedbylabel()
+        assert_equal(len(result), 1)
+        assert_equal(result[0]["involvesWatchonly"], True)
+        result = wo_wallet.listreceivedbylabel(include_watchonly=False)
+        assert_equal(len(result), 0)
+
+        self.log.info('Testing listtransactions watch-only defaults')
+        result = wo_wallet.listtransactions()
+        assert_equal(len(result), 1)
+        assert_equal(result[0]["involvesWatchonly"], True)
+        result = wo_wallet.listtransactions(include_watchonly=False)
+        assert_equal(len(result), 0)
+
+        self.log.info('Testing listsinceblock watch-only defaults')
+        result = wo_wallet.listsinceblock()
+        assert_equal(len(result["transactions"]), 1)
+        assert_equal(result["transactions"][0]["involvesWatchonly"], True)
+        result = wo_wallet.listsinceblock(include_watchonly=False)
+        assert_equal(len(result["transactions"]), 0)
+
+        self.log.info('Testing gettransaction watch-only defaults')
+        result = wo_wallet.gettransaction(txid)
+        assert_equal(result["details"][0]["involvesWatchonly"], True)
+        result = wo_wallet.gettransaction(txid=txid, include_watchonly=False)
+        assert_equal(len(result["details"]), 0)
+
+        self.log.info('Testing walletcreatefundedpsbt watch-only defaults')
+        inputs = []
+        outputs = [{a1: 0.5}]
+        options = {'changeAddress': wo_change}
+        no_wo_options = {'changeAddress': wo_change, 'includeWatching': False}
+
+        result = wo_wallet.walletcreatefundedpsbt(
+            inputs=inputs, outputs=outputs, options=options)
+        assert_equal("psbt" in result, True)
+        assert_raises_rpc_error(-4,
+                                "Insufficient funds",
+                                wo_wallet.walletcreatefundedpsbt,
+                                inputs,
+                                outputs,
+                                0,
+                                no_wo_options)
+
+        self.log.info('Testing fundrawtransaction watch-only defaults')
+        rawtx = wo_wallet.createrawtransaction(inputs=inputs, outputs=outputs)
+        result = wo_wallet.fundrawtransaction(hexstring=rawtx, options=options)
+        assert_equal("hex" in result, True)
+        assert_raises_rpc_error(-4,
+                                "Insufficient funds",
+                                wo_wallet.fundrawtransaction,
+                                rawtx,
+                                no_wo_options)
+
+
+if __name__ == '__main__':
+    CreateWalletWatchonlyTest().main()