diff --git a/src/chainparams.cpp b/src/chainparams.cpp
index c2b3480f9d41e..8d25e6bfd2446 100644
--- a/src/chainparams.cpp
+++ b/src/chainparams.cpp
@@ -87,7 +87,7 @@ class CMainParams : public CChainParams {
         consensus.fPowNoRetargeting = false;
         consensus.nRuleChangeActivationThreshold = 1916; // 95% of 2016
         consensus.nMinerConfirmationWindow = 2016; // nPowTargetTimespan / nPowTargetSpacing
-        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].bit = 28;
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].bit = 12;
         consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nStartTime = 1199145601; // January 1, 2008
         consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nTimeout = 1230767999; // December 31, 2008
 
@@ -201,7 +201,7 @@ class CTestNetParams : public CChainParams {
         consensus.fPowNoRetargeting = false;
         consensus.nRuleChangeActivationThreshold = 1512; // 75% for testchains
         consensus.nMinerConfirmationWindow = 2016; // nPowTargetTimespan / nPowTargetSpacing
-        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].bit = 28;
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].bit = 12;
         consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nStartTime = 1199145601; // January 1, 2008
         consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nTimeout = 1230767999; // December 31, 2008
 
@@ -294,7 +294,7 @@ class CRegTestParams : public CChainParams {
         consensus.fPowNoRetargeting = true;
         consensus.nRuleChangeActivationThreshold = 108; // 75% for testchains
         consensus.nMinerConfirmationWindow = 144; // Faster than normal for regtest (144 instead of 2016)
-        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].bit = 28;
+        consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].bit = 12;
         consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nStartTime = 0;
         consensus.vDeployments[Consensus::DEPLOYMENT_TESTDUMMY].nTimeout = Consensus::BIP9Deployment::NO_TIMEOUT;
         consensus.vDeployments[Consensus::DEPLOYMENT_CSV].bit = 0;
diff --git a/src/validation.cpp b/src/validation.cpp
index a77362f5d6787..010fdb8bda6dc 100644
--- a/src/validation.cpp
+++ b/src/validation.cpp
@@ -2160,7 +2160,7 @@ void static UpdateTip(const CBlockIndex *pindexNew, const CChainParams& chainPar
         for (int i = 0; i < 100 && pindex != nullptr; i++)
         {
             int32_t nExpectedVersion = ComputeBlockVersion(pindex->pprev, chainParams.GetConsensus());
-            if (pindex->nVersion > VERSIONBITS_LAST_OLD_BLOCK_VERSION && (pindex->nVersion & ~nExpectedVersion) != 0)
+            if (pindex->nVersion > VERSIONBITS_LAST_OLD_BLOCK_VERSION && (pindex->nVersion & ~nExpectedVersion & VERSIONBITS_IGNORE_MASK) != 0)
                 ++nUpgraded;
             pindex = pindex->pprev;
         }
diff --git a/src/versionbits.h b/src/versionbits.h
index 1600dc8c933fe..6bddf27ad9c3d 100644
--- a/src/versionbits.h
+++ b/src/versionbits.h
@@ -15,7 +15,9 @@ static const int32_t VERSIONBITS_TOP_BITS = 0x20000000UL;
 /** What bitmask determines whether versionbits is in use */
 static const int32_t VERSIONBITS_TOP_MASK = 0xE0000000UL;
 /** Total bits available for versionbits */
-static const int32_t VERSIONBITS_NUM_BITS = 29;
+static const int32_t VERSIONBITS_NUM_BITS = 13;
+/** Bitmask for ignored versionbits. It should match VERSIONBITS_NUM_BITS (BIPxxx) */
+static const int32_t VERSIONBITS_IGNORE_MASK = 0xE0001FFFUL;
 
 enum ThresholdState {
     THRESHOLD_DEFINED,
diff --git a/test/functional/feature_versionbits_warning.py b/test/functional/feature_versionbits_warning.py
index 2985569a8fca3..55e299a577427 100755
--- a/test/functional/feature_versionbits_warning.py
+++ b/test/functional/feature_versionbits_warning.py
@@ -19,8 +19,9 @@
 VB_PERIOD = 144           # versionbits period length for regtest
 VB_THRESHOLD = 108        # versionbits activation threshold for regtest
 VB_TOP_BITS = 0x20000000
-VB_UNKNOWN_BIT = 27       # Choose a bit unassigned to any deployment
+VB_UNKNOWN_BIT = 11       # Choose a bit unassigned to any deployment
 VB_UNKNOWN_VERSION = VB_TOP_BITS | (1 << VB_UNKNOWN_BIT)
+VB_IGNORE_VERSION = VB_TOP_BITS | 0x1FFFE000
 
 WARN_UNKNOWN_RULES_MINED = "Unknown block versions being mined! It's possible unknown rules are in effect"
 WARN_UNKNOWN_RULES_ACTIVE = "unknown new rules activated (versionbit {})".format(VB_UNKNOWN_BIT)
@@ -71,6 +72,15 @@ def run_test(self):
         # Mine one period worth of blocks
         node.generate(VB_PERIOD)
 
+        self.log.info("Check that there is no warning if previous VB_BLOCKS have VB_PERIOD blocks with ignored versionbits version.")
+        # Build one period of blocks with ignored bit. There should be no warning
+        self.send_blocks_with_version(node.p2p, VB_PERIOD, VB_IGNORE_VERSION)
+        assert(not WARN_UNKNOWN_RULES_MINED in node.getmininginfo()["warnings"])
+        assert(not WARN_UNKNOWN_RULES_MINED in node.getnetworkinfo()["warnings"])
+        assert(not VB_PATTERN.match(node.getmininginfo()["warnings"]))
+        assert(not VB_PATTERN.match(node.getnetworkinfo()["warnings"]))
+        assert(not self.versionbits_in_alert_file())
+
         self.log.info("Check that there is no warning if previous VB_BLOCKS have <VB_THRESHOLD blocks with unknown versionbits version.")
         # Build one period of blocks with < VB_THRESHOLD blocks signaling some unknown bit
         self.send_blocks_with_version(node.p2p, VB_THRESHOLD - 1, VB_UNKNOWN_VERSION)