diff --git a/hydra-cluster/src/Hydra/Cluster/Scenarios.hs b/hydra-cluster/src/Hydra/Cluster/Scenarios.hs
index e5a3dfcb670..1777f65e6df 100644
--- a/hydra-cluster/src/Hydra/Cluster/Scenarios.hs
+++ b/hydra-cluster/src/Hydra/Cluster/Scenarios.hs
@@ -60,7 +60,7 @@ import Hydra.Cluster.Faucet (FaucetLog, createOutputAtAddress, seedFromFaucet, s
 import Hydra.Cluster.Faucet qualified as Faucet
 import Hydra.Cluster.Fixture (Actor (..), actorName, alice, aliceSk, aliceVk, bob, bobSk, bobVk, carol, carolSk)
 import Hydra.Cluster.Util (chainConfigFor, keysFor, modifyConfig, setNetworkId)
-import Hydra.ContestationPeriod (ContestationPeriod (UnsafeContestationPeriod))
+import Hydra.ContestationPeriod (ContestationPeriod (UnsafeContestationPeriod), fromDiffTime)
 import Hydra.HeadId (HeadId)
 import Hydra.Ledger (IsTx (balance))
 import Hydra.Ledger.Cardano (genKeyPair)
@@ -232,7 +232,7 @@ singlePartyHeadFullLifeCycle tracer workDir node hydraScriptsTxId =
     refuelIfNeeded tracer node Alice 25_000_000
     -- Start hydra-node on chain tip
     tip <- queryTip networkId nodeSocket
-    let contestationPeriod = UnsafeContestationPeriod $ max 1 . truncate $ 10 * blockTime
+    contestationPeriod <- fromDiffTime $ 10 * blockTime
     aliceChainConfig <-
       chainConfigFor Alice workDir nodeSocket hydraScriptsTxId [] contestationPeriod
         <&> modifyConfig (\config -> config{networkId, startChainFrom = Just tip})
diff --git a/hydra-node/hydra-node.cabal b/hydra-node/hydra-node.cabal
index 6e852db9a6d..b4a173585f5 100644
--- a/hydra-node/hydra-node.cabal
+++ b/hydra-node/hydra-node.cabal
@@ -292,6 +292,7 @@ test-suite tests
     Hydra.Chain.Direct.TimeHandleSpec
     Hydra.Chain.Direct.TxSpec
     Hydra.Chain.Direct.WalletSpec
+    Hydra.ContestationPeriodSpec
     Hydra.CryptoSpec
     Hydra.FireForgetSpec
     Hydra.HeadLogicSnapshotSpec
diff --git a/hydra-node/src/Hydra/ContestationPeriod.hs b/hydra-node/src/Hydra/ContestationPeriod.hs
index d28386b9814..562f6def308 100644
--- a/hydra-node/src/Hydra/ContestationPeriod.hs
+++ b/hydra-node/src/Hydra/ContestationPeriod.hs
@@ -2,6 +2,7 @@ module Hydra.ContestationPeriod where
 
 import Hydra.Prelude hiding (Show, show)
 
+import Data.Fixed (Pico)
 import Data.Ratio ((%))
 import Data.Time (secondsToNominalDiffTime)
 import Hydra.Data.ContestationPeriod qualified as OnChain
@@ -36,6 +37,16 @@ instance Arbitrary ContestationPeriod where
     oneMonth = oneDay * 30
     oneYear = oneDay * 365
 
+-- | Create a 'ContestationPeriod' from a 'DiffTime'. This will fail if a
+-- negative DiffTime is provided and truncates to 1s if values < 1s are given.
+fromDiffTime :: MonadFail m => DiffTime -> m ContestationPeriod
+fromDiffTime dt =
+  if seconds > 0
+    then pure . UnsafeContestationPeriod $ truncate seconds
+    else fail $ "fromDiffTime: contestation period <= 0: " <> show dt
+ where
+  seconds :: Pico = realToFrac dt
+
 -- | Convert an off-chain contestation period to its on-chain representation.
 toChain :: ContestationPeriod -> OnChain.ContestationPeriod
 toChain (UnsafeContestationPeriod s) =
diff --git a/hydra-node/src/Hydra/Options.hs b/hydra-node/src/Hydra/Options.hs
index c418ad587d5..682df182d34 100644
--- a/hydra-node/src/Hydra/Options.hs
+++ b/hydra-node/src/Hydra/Options.hs
@@ -35,7 +35,7 @@ import Hydra.Cardano.Api (
   serialiseToRawBytesHexText,
  )
 import Hydra.Chain (maximumNumberOfParties)
-import Hydra.ContestationPeriod (ContestationPeriod (UnsafeContestationPeriod))
+import Hydra.ContestationPeriod (ContestationPeriod (UnsafeContestationPeriod), fromDiffTime)
 import Hydra.Contract qualified as Contract
 import Hydra.Ledger.Cardano ()
 import Hydra.Logging (Verbosity (..))
@@ -732,7 +732,7 @@ defaultContestationPeriod = UnsafeContestationPeriod 60
 contestationPeriodParser :: Parser ContestationPeriod
 contestationPeriodParser =
   option
-    (parseNatural <|> parseNominalDiffTime)
+    (parseNatural <|> parseViaDiffTime)
     ( long "contestation-period"
         <> metavar "SECONDS"
         <> value defaultContestationPeriod
@@ -746,12 +746,7 @@ contestationPeriodParser =
  where
   parseNatural = UnsafeContestationPeriod <$> auto
 
-  parseNominalDiffTime =
-    auto >>= \dt -> do
-      let s = nominalDiffTimeToSeconds dt
-      if s <= 0
-        then fail $ "contestation period <= 0: " <> show s
-        else pure $ UnsafeContestationPeriod $ truncate s
+  parseViaDiffTime = auto >>= fromDiffTime
 
 data InvalidOptions
   = MaximumNumberOfPartiesExceeded
diff --git a/hydra-node/test/Hydra/ContestationPeriodSpec.hs b/hydra-node/test/Hydra/ContestationPeriodSpec.hs
new file mode 100644
index 00000000000..a7f9c3c3ec1
--- /dev/null
+++ b/hydra-node/test/Hydra/ContestationPeriodSpec.hs
@@ -0,0 +1,18 @@
+module Hydra.ContestationPeriodSpec where
+
+import Hydra.Prelude
+
+import Hydra.ContestationPeriod (fromDiffTime)
+import Test.Hspec (Spec, describe)
+import Test.Hspec.QuickCheck (prop)
+import Test.QuickCheck (getNonPositive, getPositive)
+import Test.QuickCheck.Instances.Time ()
+
+spec :: Spec
+spec = do
+  describe "fromDiffTime" $ do
+    prop "works for diff times > 0" $
+      isJust . fromDiffTime . getPositive
+
+    prop "fails for diff times <= 0" $
+      isNothing . fromDiffTime . getNonPositive