diff --git a/app/app.go b/app/app.go
index 304d78ff..316179f8 100644
--- a/app/app.go
+++ b/app/app.go
@@ -69,6 +69,7 @@ import (
 	capabilitykeeper "github.com/cosmos/ibc-go/modules/capability/keeper"
 	_ "github.com/cosmos/ibc-go/v8/modules/apps/27-interchain-accounts" // import for side-effects
 	_ "github.com/cosmos/ibc-go/v8/modules/apps/29-fee"                 // import for side-effects
+	ibcfeekeeper "github.com/cosmos/ibc-go/v8/modules/apps/29-fee/keeper"
 	ibctransferkeeper "github.com/cosmos/ibc-go/v8/modules/apps/transfer/keeper"
 	ibckeeper "github.com/cosmos/ibc-go/v8/modules/core/keeper"
 
@@ -136,6 +137,7 @@ type App struct {
 	// IBC
 	IBCKeeper         *ibckeeper.Keeper // IBC Keeper must be a pointer in the app, so we can SetRouter on it correctly
 	CapabilityKeeper  *capabilitykeeper.Keeper
+	IBCFeeKeeper      ibcfeekeeper.Keeper
 	IBCTransferKeeper ibctransferkeeper.Keeper
 
 	// Scoped IBC
diff --git a/app/app_config.go b/app/app_config.go
index a0d7a3db..10ed101f 100644
--- a/app/app_config.go
+++ b/app/app_config.go
@@ -51,6 +51,7 @@ import (
 	slashingtypes "github.com/cosmos/cosmos-sdk/x/slashing/types"
 	stakingtypes "github.com/cosmos/cosmos-sdk/x/staking/types"
 	capabilitytypes "github.com/cosmos/ibc-go/modules/capability/types"
+	ibcfeetypes "github.com/cosmos/ibc-go/v8/modules/apps/29-fee/types"
 	ibctransfertypes "github.com/cosmos/ibc-go/v8/modules/apps/transfer/types"
 	ibcexported "github.com/cosmos/ibc-go/v8/modules/core/exported"
 	"google.golang.org/protobuf/types/known/durationpb"
@@ -89,6 +90,7 @@ var (
 		evidencetypes.ModuleName,
 		authz.ModuleName,
 		ibctransfertypes.ModuleName,
+		ibcfeetypes.ModuleName,
 		feegrant.ModuleName,
 		paramstypes.ModuleName,
 		upgradetypes.ModuleName,
@@ -131,6 +133,7 @@ var (
 		capabilitytypes.ModuleName,
 		ibcexported.ModuleName,
 		ibctransfertypes.ModuleName,
+		ibcfeetypes.ModuleName,
 
 		// KYVE modules
 		delegationtypes.ModuleName,
@@ -150,6 +153,7 @@ var (
 		ibcexported.ModuleName,
 		ibctransfertypes.ModuleName,
 		capabilitytypes.ModuleName,
+		ibcfeetypes.ModuleName,
 
 		// KYVE modules
 		pooltypes.ModuleName,
@@ -176,6 +180,7 @@ var (
 
 		// IBC
 		{Account: ibctransfertypes.ModuleName, Permissions: []string{authtypes.Minter, authtypes.Burner}},
+		{Account: ibcfeetypes.ModuleName},
 
 		// KYVE
 		{Account: bundlestypes.ModuleName},
@@ -197,6 +202,7 @@ var (
 
 		// IBC
 		ibctransfertypes.ModuleName,
+		ibcfeetypes.ModuleName,
 
 		// KYVE
 		bundlestypes.ModuleName,
diff --git a/app/ibc.go b/app/ibc.go
index df48df6d..7bc1842e 100644
--- a/app/ibc.go
+++ b/app/ibc.go
@@ -12,6 +12,9 @@ import (
 	"github.com/cosmos/ibc-go/modules/capability"
 	capabilitykeeper "github.com/cosmos/ibc-go/modules/capability/keeper"
 	capabilitytypes "github.com/cosmos/ibc-go/modules/capability/types"
+	ibcfee "github.com/cosmos/ibc-go/v8/modules/apps/29-fee"
+	ibcfeekeeper "github.com/cosmos/ibc-go/v8/modules/apps/29-fee/keeper"
+	ibcfeetypes "github.com/cosmos/ibc-go/v8/modules/apps/29-fee/types"
 	ibctransfer "github.com/cosmos/ibc-go/v8/modules/apps/transfer"
 	ibctransferkeeper "github.com/cosmos/ibc-go/v8/modules/apps/transfer/keeper"
 	ibctransfertypes "github.com/cosmos/ibc-go/v8/modules/apps/transfer/types"
@@ -33,6 +36,7 @@ func (app *App) registerIBCModules() {
 		storetypes.NewKVStoreKey(capabilitytypes.StoreKey),
 		storetypes.NewKVStoreKey(ibcexported.StoreKey),
 		storetypes.NewKVStoreKey(ibctransfertypes.StoreKey),
+		storetypes.NewKVStoreKey(ibcfeetypes.StoreKey),
 		storetypes.NewMemoryStoreKey(capabilitytypes.MemStoreKey),
 		storetypes.NewTransientStoreKey(paramstypes.TStoreKey),
 	); err != nil {
@@ -74,12 +78,19 @@ func (app *App) registerIBCModules() {
 	govRouter := govv1beta1.NewRouter()
 	govRouter.AddRoute(govtypes.RouterKey, govv1beta1.ProposalHandler)
 
+	app.IBCFeeKeeper = ibcfeekeeper.NewKeeper(
+		app.appCodec, app.GetKey(ibcfeetypes.StoreKey),
+		app.IBCKeeper.ChannelKeeper, // may be replaced with IBC middleware
+		app.IBCKeeper.ChannelKeeper,
+		app.IBCKeeper.PortKeeper, app.AccountKeeper, app.BankKeeper,
+	)
+
 	// Create IBC transfer keeper
 	app.IBCTransferKeeper = ibctransferkeeper.NewKeeper(
 		app.appCodec,
 		app.GetKey(ibctransfertypes.StoreKey),
 		app.GetSubspace(ibctransfertypes.ModuleName),
-		app.IBCKeeper.ChannelKeeper, // may be replaced with IBC middleware
+		app.IBCFeeKeeper,
 		app.IBCKeeper.ChannelKeeper,
 		app.IBCKeeper.PortKeeper,
 		app.AccountKeeper,
@@ -90,8 +101,12 @@ func (app *App) registerIBCModules() {
 
 	app.GovKeeper.SetLegacyRouter(govRouter)
 
+	// Create IBC modules with ibcfee middleware
+	transferIBCModule := ibcfee.NewIBCMiddleware(ibctransfer.NewIBCModule(app.IBCTransferKeeper), app.IBCFeeKeeper)
+
 	// Create static IBC router, add transfer route, then set and seal it
-	ibcRouter := porttypes.NewRouter()
+	ibcRouter := porttypes.NewRouter().
+		AddRoute(ibctransfertypes.ModuleName, transferIBCModule)
 
 	// this line is used by starport scaffolding # ibc/app/module
 
@@ -104,6 +119,7 @@ func (app *App) registerIBCModules() {
 	if err := app.RegisterModules(
 		ibc.NewAppModule(app.IBCKeeper),
 		ibctransfer.NewAppModule(app.IBCTransferKeeper),
+		ibcfee.NewAppModule(app.IBCFeeKeeper),
 		capability.NewAppModule(app.appCodec, *app.CapabilityKeeper, false),
 		ibctm.AppModule{},
 		solomachine.AppModule{},
@@ -119,6 +135,7 @@ func RegisterIBC(registry cdctypes.InterfaceRegistry) map[string]appmodule.AppMo
 	modules := map[string]appmodule.AppModule{
 		ibcexported.ModuleName:      ibc.AppModule{},
 		ibctransfertypes.ModuleName: ibctransfer.AppModule{},
+		ibcfeetypes.ModuleName:      ibcfee.AppModule{},
 		capabilitytypes.ModuleName:  capability.AppModule{},
 		ibctm.ModuleName:            ibctm.AppModule{},
 		solomachine.ModuleName:      solomachine.AppModule{},