diff --git a/src/rpc/rawtransaction.cpp b/src/rpc/rawtransaction.cpp
index 2bd8914716f..1881bb12f7e 100644
--- a/src/rpc/rawtransaction.cpp
+++ b/src/rpc/rawtransaction.cpp
@@ -972,7 +972,7 @@ static RPCHelpMan sendrawtransaction()
         //   will always be blinded and not explicit. In the former case, we
         //   error out because the transaction is not blinded properly.
         if (!out.nNonce.IsNull() && out.nValue.IsExplicit()) {
-            throw JSONRPCError(RPC_TRANSACTION_ERROR, "Transaction output has nonce, but is not blinded. Did you forget to call blindrawtranssaction, or rawblindrawtransaction?");
+            throw JSONRPCError(RPC_TRANSACTION_ERROR, "Transaction output has nonce, but is not blinded. Did you forget to call blindrawtransaction, or rawblindrawtransaction?");
         }
     }
 
diff --git a/test/functional/test_runner.py b/test/functional/test_runner.py
index dd0fc8fbd0f..d282c81b4fe 100755
--- a/test/functional/test_runner.py
+++ b/test/functional/test_runner.py
@@ -110,6 +110,7 @@
     'feature_progress.py',
     'rpc_getnewblockhex.py',
     'wallet_elements_regression_1172.py --legacy-wallet',
+    'wallet_elements_regression_1259.py --legacy-wallet',
     # Longest test should go first, to favor running tests in parallel
     'wallet_hd.py --legacy-wallet',
     'wallet_hd.py --descriptors',
diff --git a/test/functional/wallet_elements_regression_1259.py b/test/functional/wallet_elements_regression_1259.py
new file mode 100755
index 00000000000..642062c579d
--- /dev/null
+++ b/test/functional/wallet_elements_regression_1259.py
@@ -0,0 +1,91 @@
+#!/usr/bin/env python3
+# Copyright (c) 2017-2020 The Bitcoin Core developers
+# Distributed under the MIT software license, see the accompanying
+# file COPYING or http://www.opensource.org/licenses/mit-license.php.
+"""Tests that fundrawtransaction correcly handles the case of sending many
+inputs of an issued asset, with no policy asset recipient.
+
+See: https://github.com/ElementsProject/elements/issues/1259
+
+This test issues an asset and creates many utxos, which are then used as inputs in
+a consolidation transaction created with the various raw transaction calls.
+"""
+from decimal import Decimal
+
+from test_framework.blocktools import COINBASE_MATURITY
+from test_framework.test_framework import BitcoinTestFramework
+from test_framework.util import (
+    assert_equal,
+)
+
+class WalletTest(BitcoinTestFramework):
+    def set_test_params(self):
+        self.setup_clean_chain = True
+        self.num_nodes = 3
+        self.extra_args = [[
+            "-blindedaddresses=1",
+            "-initialfreecoins=2100000000000000",
+            "-con_blocksubsidy=0",
+            "-con_connect_genesis_outputs=1",
+            "-txindex=1",
+        ]] * self.num_nodes
+        self.extra_args[0].append("-anyonecanspendaremine=1")
+
+    def skip_test_if_missing_module(self):
+        self.skip_if_no_wallet()
+
+    def run_test(self):
+        self.generate(self.nodes[0], COINBASE_MATURITY + 1)
+        self.sync_all()
+
+        self.log.info(f"Send some policy asset to node 1")
+        self.nodes[0].sendtoaddress(self.nodes[1].getnewaddress(), 10)
+        self.generate(self.nodes[0], 1)
+
+        self.log.info(f"Issuing an asset from node 0")
+        issuance = self.nodes[0].issueasset(1000, 1, True)
+        self.generate(self.nodes[0], 1)
+        asset = issuance["asset"]
+        self.log.info(f"Asset ID is {asset}")
+
+        # create many outputs of the new asset on node 1
+        num_utxos = 45
+        value = 10
+        fee_rate = 10
+        self.log.info(f"Sending {num_utxos} utxos of asset to node 1")
+        for i in range(num_utxos):
+            self.nodes[0].sendtoaddress(self.nodes[1].getnewaddress(), value, "", "", False, False, None, None, None, asset, False, fee_rate, True)
+            self.generate(self.nodes[0], 1)
+
+        # create a raw tx on node 1 consolidating the asset utxos
+        self.log.info(f"Create the raw consolidation transaction")
+        hex = self.nodes[1].createrawtransaction([], [{ 'asset': asset, self.nodes[2].getnewaddress(): num_utxos * value }])
+
+        # fund the raw tx
+        self.log.info(f"Fund the raw transaction")
+        raw_tx = self.nodes[1].fundrawtransaction(hex, True)
+
+        # blind and sign the tx
+        self.log.info(f"Blind and sign the raw transaction")
+        hex = self.nodes[1].blindrawtransaction(raw_tx['hex'])
+        signed_tx = self.nodes[1].signrawtransactionwithwallet(hex)
+        assert_equal(signed_tx['complete'], True)
+
+        # decode tx
+        tx = self.nodes[1].decoderawtransaction(signed_tx['hex'])
+
+        assert_equal(len(tx['vin']), num_utxos + 1)
+        assert_equal(len(tx['vout']), 3)
+        assert_equal(tx['fee'], {'b2e15d0d7a0c94e4e2ce0fe6e8691b9e451377f6e46e8045a86f7c4b5d4f0f23': Decimal('0.00112380')}) # fee output
+
+        # send and mine the tx
+        self.log.info(f"Send the raw transaction")
+        self.nodes[1].sendrawtransaction(signed_tx['hex'])
+        self.generate(self.nodes[0], 1)
+        self.sync_all()
+        balance = self.nodes[2].getbalance()
+        assert_equal(balance[asset], Decimal(num_utxos * value))
+
+
+if __name__ == '__main__':
+    WalletTest().main()