diff --git a/client.go b/client.go
index f947cd08..da261661 100644
--- a/client.go
+++ b/client.go
@@ -21,6 +21,7 @@ import (
 	"github.com/lightninglabs/loop/sweep"
 	"github.com/lightninglabs/loop/sweepbatcher"
 	"github.com/lightninglabs/loop/utils"
+	"github.com/lightninglabs/loop/utils/chainhashutil"
 	"github.com/lightninglabs/taproot-assets/rpcutils"
 	"github.com/lightningnetwork/lnd/clock"
 	"github.com/lightningnetwork/lnd/lntypes"
@@ -272,14 +273,9 @@ func NewClient(dbDir string, loopDB loopdb.SwapStore,
 	}
 
 	if len(cfg.SkippedTxns) != 0 {
-		skippedTxns := make(map[chainhash.Hash]struct{})
-		for _, txid := range cfg.SkippedTxns {
-			txid, err := chainhash.NewHashFromStr(txid)
-			if err != nil {
-				return nil, nil, fmt.Errorf("failed to parse "+
-					"txid to skip %v: %w", txid, err)
-			}
-			skippedTxns[*txid] = struct{}{}
+		skippedTxns, err := parseSkippedTxns(cfg.SkippedTxns)
+		if err != nil {
+			return nil, nil, err
 		}
 		batcherOpts = append(batcherOpts, sweepbatcher.WithSkippedTxns(
 			skippedTxns,
@@ -323,6 +319,24 @@ func NewClient(dbDir string, loopDB loopdb.SwapStore,
 	return client, cleanup, nil
 }
 
+// parseSkippedTxns parses the configured skipped transaction IDs and rejects
+// any txid that is not fully specified.
+func parseSkippedTxns(txids []string) (map[chainhash.Hash]struct{}, error) {
+	skippedTxns := make(map[chainhash.Hash]struct{}, len(txids))
+
+	for _, txid := range txids {
+		hash, err := chainhashutil.NewHashFromStrExact(txid)
+		if err != nil {
+			return nil, fmt.Errorf("failed to parse txid to skip %v: %w",
+				txid, err)
+		}
+
+		skippedTxns[hash] = struct{}{}
+	}
+
+	return skippedTxns, nil
+}
+
 // GetConn returns the gRPC connection to the server.
 func (s *Client) GetConn() *grpc.ClientConn {
 	return s.clientConfig.Conn
diff --git a/client_test.go b/client_test.go
index 15b9c7c9..ede6e2ff 100644
--- a/client_test.go
+++ b/client_test.go
@@ -4,6 +4,7 @@ import (
 	"context"
 	"crypto/sha256"
 	"errors"
+	"strings"
 	"testing"
 
 	"github.com/btcsuite/btcd/btcutil"
@@ -46,6 +47,50 @@ var (
 	defaultConfirmations = int32(loopdb.DefaultLoopOutHtlcConfirmations)
 )
 
+// TestParseSkippedTxns verifies that skipped txids must be fully specified.
+func TestParseSkippedTxns(t *testing.T) {
+	t.Parallel()
+
+	validTxid := strings.Repeat("01", 32)
+	validHash, err := chainhash.NewHashFromStr(validTxid)
+	require.NoError(t, err)
+
+	tests := []struct {
+		name        string
+		txids       []string
+		expected    map[chainhash.Hash]struct{}
+		expectedErr string
+	}{
+		{
+			name:  "valid",
+			txids: []string{validTxid},
+			expected: map[chainhash.Hash]struct{}{
+				*validHash: {},
+			},
+		},
+		{
+			name:        "short",
+			txids:       []string{"abcd"},
+			expectedErr: "failed to parse txid to skip abcd",
+		},
+	}
+
+	for _, test := range tests {
+		t.Run(test.name, func(t *testing.T) {
+			t.Parallel()
+
+			skippedTxns, err := parseSkippedTxns(test.txids)
+			if test.expectedErr != "" {
+				require.ErrorContains(t, err, test.expectedErr)
+				return
+			}
+
+			require.NoError(t, err)
+			require.Equal(t, test.expected, skippedTxns)
+		})
+	}
+}
+
 var htlcKeys = func() loopdb.HtlcKeys {
 	var senderKey, receiverKey [33]byte