diff --git a/src/bin/expect_tests/contract_tests.ml b/src/bin/expect_tests/contract_tests.ml
index 4d2d6b5a9..0ce94f98d 100644
--- a/src/bin/expect_tests/contract_tests.ml
+++ b/src/bin/expect_tests/contract_tests.ml
@@ -931,4 +931,8 @@ let%expect_test _ =
 
 let%expect_test _ =
   run_ligo_bad [ "run-function" ; contract "failwith.ligo" ; "failer" ; "1" ] ;
-  [%expect {| ligo: Execution failed:  {"value":"some_string","type":"string"} |}]
\ No newline at end of file
+  [%expect {| ligo: Execution failed:  {"value":"some_string","type":"string"} |}]
+
+let%expect_test _ =
+  run_ligo_bad [ "compile-contract" ; contract "bad_address_format.religo" ; "main" ] ;
+  [%expect {| ligo: in file "bad_address_format.religo", line 2, characters 25-47. Badly formatted address "KT1badaddr":  {"location":"in file \"bad_address_format.religo\", line 2, characters 25-47"} |}]
diff --git a/src/passes/3-self_ast_simplified/dune b/src/passes/3-self_ast_simplified/dune
index 69dc6b507..aef575249 100644
--- a/src/passes/3-self_ast_simplified/dune
+++ b/src/passes/3-self_ast_simplified/dune
@@ -4,6 +4,7 @@
   (libraries
     simple-utils
     ast_simplified
+    proto-alpha-utils
   )
   (preprocess
     (pps ppx_let bisect_ppx --conditional)
diff --git a/src/passes/3-self_ast_simplified/literals.ml b/src/passes/3-self_ast_simplified/literals.ml
index 38116590b..dfe3cac4a 100644
--- a/src/passes/3-self_ast_simplified/literals.ml
+++ b/src/passes/3-self_ast_simplified/literals.ml
@@ -1,9 +1,28 @@
 open Ast_simplified
 open Trace
+open Proto_alpha_utils
+
+module Errors = struct
+  let bad_literal_address s_addr loc () =
+    let title = (thunk ("Badly formatted address \""^s_addr^"\"")) in
+    let message () = "" in
+    let data = [
+      ("location" , fun () -> Format.asprintf "%a" Location.pp loc)
+    ] in
+    error ~data title message ()
+end
+open Errors
 
 let peephole_expression : expression -> expression result = fun e ->
   let return expression = ok { e with expression } in
   match e.expression with
+  | E_literal (Literal_address s) as l -> (
+    let open Memory_proto_alpha in
+    let%bind (_contract:Protocol.Alpha_context.Contract.t) = 
+      Trace.trace_alpha_tzresult (bad_literal_address s e.location) @@
+      Protocol.Alpha_context.Contract.of_b58check s in
+    return l
+    )
   | E_constant (C_BIG_MAP_LITERAL , lst) -> (
       let%bind elt =
         trace_option (simple_error "big_map literal expects a single parameter") @@
diff --git a/src/test/contracts/bad_address_format.religo b/src/test/contracts/bad_address_format.religo
new file mode 100644
index 000000000..c8668bc45
--- /dev/null
+++ b/src/test/contracts/bad_address_format.religo
@@ -0,0 +1,3 @@
+let main = (parameter: int, storage: address) => {     
+    ([]:list(operation), "KT1badaddr" : address);
+};