diff --git a/pages/wallets/index.js b/pages/wallets/index.js
index a547e9ed..78ac45a5 100644
--- a/pages/wallets/index.js
+++ b/pages/wallets/index.js
@@ -68,6 +68,19 @@ export default function Wallet () {
     )
   }
 
+  if (status instanceof Error) {
+    return (
+      <WalletLayout>
+        <div className='py-5 text-center d-flex flex-column align-items-center justify-content-center flex-grow-1'>
+          <span className='text-muted fw-bold my-1'>failed to load wallets</span>
+          <small className='d-block text-muted'>
+            {status.message}
+          </small>
+        </div>
+      </WalletLayout>
+    )
+  }
+
   if (status === Status.NO_WALLETS && !showWallets) {
     return (
       <WalletLayout>
diff --git a/wallets/client/context/hooks.js b/wallets/client/context/hooks.js
index 89255cd9..aab7cda1 100644
--- a/wallets/client/context/hooks.js
+++ b/wallets/client/context/hooks.js
@@ -9,7 +9,7 @@ import {
   useWalletMigrationMutation, CryptoKeyRequiredError, useIsWrongKey
 } from '@/wallets/client/hooks'
 import { WalletConfigurationError } from '@/wallets/client/errors'
-import { SET_WALLETS, WRONG_KEY, KEY_MATCH, NO_KEY, useWalletsDispatch } from '@/wallets/client/context'
+import { SET_WALLETS, WRONG_KEY, KEY_MATCH, NO_KEY, useWalletsDispatch, WALLETS_QUERY_ERROR } from '@/wallets/client/context'
 import { useIndexedDB } from '@/components/use-indexeddb'
 
 export function useServerWallets () {
@@ -19,6 +19,7 @@ export function useServerWallets () {
   useEffect(() => {
     if (query.error) {
       console.error('failed to fetch wallets:', query.error)
+      dispatch({ type: WALLETS_QUERY_ERROR, error: query.error })
       return
     }
     if (query.loading) return
diff --git a/wallets/client/context/reducer.js b/wallets/client/context/reducer.js
index b0cbe09b..365c2475 100644
--- a/wallets/client/context/reducer.js
+++ b/wallets/client/context/reducer.js
@@ -15,6 +15,7 @@ export const SET_KEY = 'SET_KEY'
 export const WRONG_KEY = 'WRONG_KEY'
 export const KEY_MATCH = 'KEY_MATCH'
 export const NO_KEY = 'KEY_UNAVAILABLE'
+export const WALLETS_QUERY_ERROR = 'WALLETS_QUERY_ERROR'
 
 export default function reducer (state, action) {
   switch (action.type) {
@@ -32,6 +33,11 @@ export default function reducer (state, action) {
         templates
       }
     }
+    case WALLETS_QUERY_ERROR:
+      return {
+        ...state,
+        status: transitionStatus(action, state, action.error)
+      }
     case SET_KEY:
       return {
         ...state,
@@ -61,10 +67,10 @@ export default function reducer (state, action) {
 function transitionStatus ({ type }, { status: from }, to) {
   switch (type) {
     case SET_WALLETS: {
-      return [Status.PASSPHRASE_REQUIRED, Status.WALLETS_UNAVAILABLE].includes(from) ? from : to
+      return (from instanceof Error || [Status.PASSPHRASE_REQUIRED, Status.WALLETS_UNAVAILABLE].includes(from)) ? from : to
     }
     case KEY_MATCH: {
-      return from === Status.LOADING_WALLETS ? from : to
+      return (from instanceof Error || from === Status.LOADING_WALLETS) ? from : to
     }
     default:
       return to
diff --git a/wallets/client/hooks/query.js b/wallets/client/hooks/query.js
index 9e1e97cf..177bcf3e 100644
--- a/wallets/client/hooks/query.js
+++ b/wallets/client/hooks/query.js
@@ -38,6 +38,7 @@ export function useWalletsQuery () {
   const { me } = useMe()
   const query = useQuery(WALLETS, { skip: !me })
   const [wallets, setWallets] = useState(null)
+  const [error, setError] = useState(null)
 
   const { decryptWallet, ready } = useWalletDecryption()
 
@@ -48,10 +49,14 @@ export function useWalletsQuery () {
     )
       .then(wallets => wallets.map(protocolCheck))
       .then(wallets => wallets.map(undoFieldAlias))
-      .then(wallets => setWallets(wallets))
+      .then(wallets => {
+        setWallets(wallets)
+        setError(null)
+      })
       .catch(err => {
         console.error('failed to decrypt wallets:', err)
         setWallets([])
+        setError(new Error('decryption error: ' + err.message))
       })
   }, [query.data, decryptWallet, ready])
 
@@ -59,9 +64,10 @@ export function useWalletsQuery () {
 
   return useMemo(() => ({
     ...query,
+    error: error ?? query.error,
     loading: !wallets,
     data: wallets ? { wallets } : null
-  }), [query, wallets])
+  }), [query, error, wallets])
 }
 
 function protocolCheck (wallet) {