diff --git a/src/__tests__/setup.ts b/src/__tests__/setup.ts
index 8e5f93a..8c85eae 100644
--- a/src/__tests__/setup.ts
+++ b/src/__tests__/setup.ts
@@ -1,4 +1,5 @@
 import { PGlite } from '@electric-sql/pglite';
+import { initializeDatabase, dropTables } from '../schema';
 
 // Set up test environment variables before any tests run
 process.env.SKIP_SIGNING_VERIFICATION = 'true';
@@ -29,94 +30,20 @@ class DatabaseManager {
     if (!this.db) {
       this.db = new PGlite('memory://');
       await this.db.ready;
-
-      // Wrap table creation in a transaction
-      await this.db.query('BEGIN');
-      try {
-        // Create sessions table
-        await this.db.query(`
-          CREATE TABLE IF NOT EXISTS sessions (
-            id TEXT PRIMARY KEY,
-            address TEXT NOT NULL,
-            nonce TEXT NOT NULL,
-            created_at TIMESTAMP WITH TIME ZONE DEFAULT CURRENT_TIMESTAMP,
-            expires_at TIMESTAMP WITH TIME ZONE NOT NULL,
-            domain TEXT NOT NULL
-          )
-        `);
-
-        // Create nonces table
-        await this.db.query(`
-          CREATE TABLE IF NOT EXISTS nonces (
-            id TEXT PRIMARY KEY,
-            chain_id TEXT NOT NULL,
-            nonce TEXT NOT NULL,
-            consumed_at TIMESTAMP WITH TIME ZONE DEFAULT CURRENT_TIMESTAMP,
-            UNIQUE(chain_id, nonce)
-          )
-        `);
-
-        // Create compacts table
-        await this.db.query(`
-          CREATE TABLE IF NOT EXISTS compacts (
-            id TEXT PRIMARY KEY,
-            chain_id TEXT NOT NULL,
-            claim_hash TEXT NOT NULL,
-            arbiter TEXT NOT NULL,
-            sponsor TEXT NOT NULL,
-            nonce TEXT NOT NULL,
-            expires BIGINT NOT NULL,
-            compact_id TEXT NOT NULL,
-            amount TEXT NOT NULL,
-            witness_type_string TEXT,
-            witness_hash TEXT,
-            signature TEXT NOT NULL,
-            created_at TIMESTAMP WITH TIME ZONE DEFAULT CURRENT_TIMESTAMP,
-            UNIQUE(chain_id, claim_hash)
-          )
-        `);
-
-        // Create indexes
-        await this.db.query(
-          'CREATE INDEX IF NOT EXISTS idx_sessions_address ON sessions(address)'
-        );
-        await this.db.query(
-          'CREATE INDEX IF NOT EXISTS idx_sessions_expires_at ON sessions(expires_at)'
-        );
-        await this.db.query(
-          'CREATE INDEX IF NOT EXISTS idx_compacts_sponsor ON compacts(sponsor)'
-        );
-        await this.db.query(
-          'CREATE INDEX IF NOT EXISTS idx_compacts_chain_claim ON compacts(chain_id, claim_hash)'
-        );
-        await this.db.query(
-          'CREATE INDEX IF NOT EXISTS idx_nonces_chain_nonce ON nonces(chain_id, nonce)'
-        );
-
-        await this.db.query('COMMIT');
-      } catch (error) {
-        await this.db.query('ROLLBACK');
-        throw error;
-      }
+      await initializeDatabase(this.db);
     }
-    return;
   }
 
   async getDb(): Promise<PGlite> {
     if (!this.db) {
-      return this.initialize().then(() => this.db as PGlite);
+      await this.initialize();
     }
     return this.db as PGlite;
   }
 
   async cleanup(): Promise<void> {
     if (this.db) {
-      // Drop all tables
-      await this.db.query('DROP TABLE IF EXISTS sessions CASCADE');
-      await this.db.query('DROP TABLE IF EXISTS nonces CASCADE');
-      await this.db.query('DROP TABLE IF EXISTS compacts CASCADE');
-
-      // Reset the database connection
+      await dropTables(this.db);
       this.db = null;
     }
   }
diff --git a/src/database.ts b/src/database.ts
index 2b466ea..a373468 100644
--- a/src/database.ts
+++ b/src/database.ts
@@ -1,34 +1,10 @@
 import { FastifyInstance } from 'fastify';
 import { PGlite } from '@electric-sql/pglite';
+import { initializeDatabase } from './schema';
 
 export async function setupDatabase(server: FastifyInstance): Promise<void> {
   const db = new PGlite();
-
-  // Create sessions table
-  await db.query(`
-    CREATE TABLE IF NOT EXISTS sessions (
-      id TEXT PRIMARY KEY,
-      address TEXT NOT NULL,
-      nonce TEXT NOT NULL,
-      created_at TIMESTAMP WITH TIME ZONE DEFAULT CURRENT_TIMESTAMP,
-      expires_at TIMESTAMP WITH TIME ZONE NOT NULL,
-      domain TEXT NOT NULL
-    )
-  `);
-
-  // Create compacts table
-  await db.query(`
-    CREATE TABLE IF NOT EXISTS compacts (
-      id TEXT PRIMARY KEY,
-      address TEXT NOT NULL,
-      nonce TEXT NOT NULL,
-      signature TEXT NOT NULL,
-      message TEXT NOT NULL,
-      created_at TIMESTAMP WITH TIME ZONE DEFAULT CURRENT_TIMESTAMP,
-      expires_at TIMESTAMP WITH TIME ZONE NOT NULL,
-      domain TEXT NOT NULL
-    )
-  `);
+  await initializeDatabase(db);
 
   // Add the database instance to the server
   server.decorate('db', db);
diff --git a/src/schema.ts b/src/schema.ts
new file mode 100644
index 0000000..b853ea9
--- /dev/null
+++ b/src/schema.ts
@@ -0,0 +1,88 @@
+import { PGlite } from '@electric-sql/pglite';
+
+export const schemas = {
+  sessions: `
+    CREATE TABLE IF NOT EXISTS sessions (
+      id TEXT PRIMARY KEY,
+      address TEXT NOT NULL,
+      nonce TEXT NOT NULL,
+      created_at TIMESTAMP WITH TIME ZONE DEFAULT CURRENT_TIMESTAMP,
+      expires_at TIMESTAMP WITH TIME ZONE NOT NULL,
+      domain TEXT NOT NULL
+    )
+  `,
+  nonces: `
+    CREATE TABLE IF NOT EXISTS nonces (
+      id TEXT PRIMARY KEY,
+      chain_id TEXT NOT NULL,
+      nonce TEXT NOT NULL,
+      consumed_at TIMESTAMP WITH TIME ZONE DEFAULT CURRENT_TIMESTAMP,
+      UNIQUE(chain_id, nonce)
+    )
+  `,
+  compacts: `
+    CREATE TABLE IF NOT EXISTS compacts (
+      id TEXT PRIMARY KEY,
+      chain_id TEXT NOT NULL,
+      claim_hash TEXT NOT NULL,
+      arbiter TEXT NOT NULL,
+      sponsor TEXT NOT NULL,
+      nonce TEXT NOT NULL,
+      expires BIGINT NOT NULL,
+      compact_id TEXT NOT NULL,
+      amount TEXT NOT NULL,
+      witness_type_string TEXT,
+      witness_hash TEXT,
+      signature TEXT NOT NULL,
+      created_at TIMESTAMP WITH TIME ZONE DEFAULT CURRENT_TIMESTAMP,
+      UNIQUE(chain_id, claim_hash)
+    )
+  `,
+};
+
+export const indexes = {
+  sessions: [
+    'CREATE INDEX IF NOT EXISTS idx_sessions_address ON sessions(address)',
+    'CREATE INDEX IF NOT EXISTS idx_sessions_expires_at ON sessions(expires_at)',
+  ],
+  compacts: [
+    'CREATE INDEX IF NOT EXISTS idx_compacts_sponsor ON compacts(sponsor)',
+    'CREATE INDEX IF NOT EXISTS idx_compacts_chain_claim ON compacts(chain_id, claim_hash)',
+  ],
+  nonces: [
+    'CREATE INDEX IF NOT EXISTS idx_nonces_chain_nonce ON nonces(chain_id, nonce)',
+  ],
+};
+
+export async function initializeDatabase(db: PGlite): Promise<void> {
+  await db.query('BEGIN');
+  try {
+    // Create tables
+    await Promise.all(Object.values(schemas).map((schema) => db.query(schema)));
+
+    // Create indexes
+    await Promise.all(
+      Object.values(indexes)
+        .flat()
+        .map((index) => db.query(index))
+    );
+
+    await db.query('COMMIT');
+  } catch (error) {
+    await db.query('ROLLBACK');
+    throw error;
+  }
+}
+
+export async function dropTables(db: PGlite): Promise<void> {
+  await db.query('BEGIN');
+  try {
+    for (const table of Object.keys(schemas)) {
+      await db.query(`DROP TABLE IF EXISTS ${table} CASCADE`);
+    }
+    await db.query('COMMIT');
+  } catch (error) {
+    await db.query('ROLLBACK');
+    throw error;
+  }
+}