diff --git a/core/src/main/java/haveno/core/trade/Trade.java b/core/src/main/java/haveno/core/trade/Trade.java
index 1ee3cb8b83..f0b0ee2873 100644
--- a/core/src/main/java/haveno/core/trade/Trade.java
+++ b/core/src/main/java/haveno/core/trade/Trade.java
@@ -1812,19 +1812,6 @@ public abstract class Trade extends XmrWalletBase implements Tradable, Model {
             return;
         }
 
-        // unreserve taker's key images
-        if (this instanceof TakerTrade) {
-            ThreadUtils.submitToPool(() -> {
-                xmrWalletService.thawOutputs(getSelf().getReserveTxKeyImages());
-            });
-        }
-
-        // unreserve maker's open offer
-        Optional<OpenOffer> openOffer = processModel.getOpenOfferManager().getOpenOffer(this.getId());
-        if (this instanceof MakerTrade && openOffer.isPresent()) {
-            processModel.getOpenOfferManager().unreserveOpenOffer(openOffer.get());
-        }
-
         // remove if deposit not requested or is failed
         if (!isDepositRequested() || isDepositRequestFailed()) {
             removeTradeOnError();
@@ -1832,7 +1819,10 @@ public abstract class Trade extends XmrWalletBase implements Tradable, Model {
         }
 
         // done if wallet already deleted
-        if (!walletExists()) return;
+        if (!walletExists()) {
+            removeTradeOnError();
+            return;
+        }
 
         // set error height
         if (processModel.getTradeProtocolErrorHeight() == 0) {
@@ -1927,6 +1917,19 @@ public abstract class Trade extends XmrWalletBase implements Tradable, Model {
             forceCloseWallet();
             if (isDepositRequested()) getWallet();
 
+            // unreserve taker's key images
+            if (this instanceof TakerTrade) {
+                ThreadUtils.submitToPool(() -> {
+                    xmrWalletService.thawOutputs(getSelf().getReserveTxKeyImages());
+                });
+            }
+
+            // unreserve maker's open offer
+            Optional<OpenOffer> openOffer = processModel.getOpenOfferManager().getOpenOffer(this.getId());
+            if (this instanceof MakerTrade && openOffer.isPresent()) {
+                processModel.getOpenOfferManager().unreserveOpenOffer(openOffer.get());
+            }
+
             // clear and shut down trade
             onShutDownStarted();
             clearAndShutDown();
diff --git a/core/src/main/java/haveno/core/trade/TradeManager.java b/core/src/main/java/haveno/core/trade/TradeManager.java
index 1a764a80cf..937edba786 100644
--- a/core/src/main/java/haveno/core/trade/TradeManager.java
+++ b/core/src/main/java/haveno/core/trade/TradeManager.java
@@ -445,7 +445,7 @@ public class TradeManager implements PersistedDataHost, DecryptedDirectMessageLi
             Set<Trade> uninitializedTrades = new HashSet<Trade>();
             for (Trade trade : trades) {
                 Runnable initTradeTask = getInitTradeTask(trade, trades, tradesToSkip, uninitializedTrades, uids);
-                if (trade.isDepositsPublished() && !trade.isPayoutUnlocked()) initTasksP1.add(initTradeTask);
+                if (trade.isDepositRequested() && !trade.isPayoutUnlocked()) initTasksP1.add(initTradeTask);
                 else initTasksP2.add(initTradeTask);
             };
             ThreadUtils.awaitTasks(initTasksP1, threadPoolSize);
@@ -920,6 +920,10 @@ public class TradeManager implements PersistedDataHost, DecryptedDirectMessageLi
             // ensure trade is not already open
             Optional<Trade> tradeOptional = getOpenTrade(offer.getId());
             if (tradeOptional.isPresent()) throw new RuntimeException("Cannot create trade protocol because trade with ID " + offer.getId() + " is already open");
+
+            // ensure failed trade is not processing
+            tradeOptional = getFailedTrade(offer.getId());
+            if (tradeOptional.isPresent() && tradeOptional.get().walletExists()) throw new RuntimeException("Cannot create trade protocol because trade with ID " + offer.getId() + " has failed but is not processed");
     
             // create trade
             Trade trade;
diff --git a/core/src/main/java/haveno/core/trade/protocol/TradeProtocol.java b/core/src/main/java/haveno/core/trade/protocol/TradeProtocol.java
index fc9386bc3b..be4a3a7beb 100644
--- a/core/src/main/java/haveno/core/trade/protocol/TradeProtocol.java
+++ b/core/src/main/java/haveno/core/trade/protocol/TradeProtocol.java
@@ -536,6 +536,11 @@ public abstract class TradeProtocol implements DecryptedDirectMessageListener, D
             return;
         }
 
+        // log warning if trade not open
+        if (!processModel.getTradeManager().hasOpenTrade(trade)) {
+            log.warn("We received a PaymentSentMessage for {} {} but it is not an open trade. This can happen if the trade is pending processing as a failed trade.", trade.getClass().getSimpleName(), trade.getId());
+        }
+
         // validate signature
         try {
             HavenoUtils.verifyPaymentSentMessage(trade, message);