diff --git a/apps/amethyst/lib/apps/connection_handler.ex b/apps/amethyst/lib/apps/connection_handler.ex
index d8232a2..569e7ce 100644
--- a/apps/amethyst/lib/apps/connection_handler.ex
+++ b/apps/amethyst/lib/apps/connection_handler.ex
@@ -19,6 +19,7 @@ defmodule Amethyst.ConnectionHandler do
   This module is responsible for handling incoming packets and sending outgoing packets. It keeps track of what state the connection is in and which game should
   receive the packets.
   """
+  alias Amethyst.Minecraft.Write
   require Logger
 
   @spec child_spec(:gen_tcp.socket()) :: Supervisor.child_spec()
@@ -63,6 +64,10 @@ defmodule Amethyst.ConnectionHandler do
         decryption_state = :crypto.crypto_init(:aes_128_cfb8, secret, secret, false)
         state = state |> Map.put(:encryption_state, encryption_state) |> Map.put(:decryption_state, decryption_state)
         loop(socket, connstate, version, state)
+      {:set_compression, threshold} ->
+        Logger.debug("Enabling comrpession with threshold #{threshold}")
+        state = Map.put(state, :compression, threshold)
+        loop(socket, connstate, version, state)
       {:set_position, position} ->
         prev_position = Map.get(state, :position)
         state = Map.put(state, :position, position)
@@ -83,9 +88,9 @@ defmodule Amethyst.ConnectionHandler do
             if prev_cp == nil do
               MapSet.new([])
             else
-              MapSet.new(visible_chunks_from(elem(prev_cp, 0), elem(prev_cp, 1), Map.get(state, :view_distance, 16)))
+              MapSet.new(visible_chunks_from(elem(prev_cp, 0), elem(prev_cp, 1), 16)) # This 16 would be the server view distance!!
             end
-          chunks = MapSet.new(visible_chunks_from(elem(cp, 0), elem(cp, 1), Map.get(state, :view_distance, 16)))
+          chunks = MapSet.new(visible_chunks_from(elem(cp, 0), elem(cp, 1), 16))
           new_chunks = MapSet.difference(chunks, prev_chunks)
           Logger.debug("Sending #{MapSet.size(new_chunks)} chunks...")
           # We can process all chunks in parallel
@@ -112,6 +117,9 @@ defmodule Amethyst.ConnectionHandler do
           {:get_encryption, from} ->
             send(from, Map.get(state, :decryption_state))
             loop(socket, connstate, version, state)
+          {:get_compression, from} ->
+            send(from, Map.get(state, :compression))
+            loop(socket, connstate, version, state)
           {:packet, id, data} ->
             state = handle_packet(id, data, connstate, version, state)
             loop(socket, connstate, version, state)
@@ -250,14 +258,28 @@ defmodule Amethyst.ConnectionHandler do
   defp send_packet(socket, connstate, packet, version, state) do
     try do
       data = connstate.serialize(packet, version)
-      length = byte_size(data) |> Amethyst.Minecraft.Write.varint()
-      case Map.get(state, :encryption_state) do
-        nil ->
-          :gen_tcp.send(socket, length <> data)
-        estate ->
-          encrypted = :crypto.crypto_update(estate, length <> data)
-          :gen_tcp.send(socket, encrypted)
+      Logger.debug("#{inspect(Map.get(state, :compression))}")
+      container = if Map.get(state, :compression) == nil do
+        # Packet ID is included in data
+        Write.varint(byte_size(data)) <> data
+      else
+        threshold = Map.get(state, :compression, 0)
+        data_length = byte_size(data)
+        if data_length >= threshold do
+          compressed = Write.varint(data_length) <> :zlib.compress(data)
+          Write.varint(byte_size(compressed)) <> compressed
+        else
+          compressed = Write.varint(0) <> data
+          Write.varint(byte_size(compressed)) <> compressed
+        end
       end
+      Logger.debug(inspect(container))
+      encrypted = if Map.get(state, :encryption_state) == nil do
+        container
+      else
+        Map.get(state, :encryption_state) |> :crypto.crypto_update(container)
+      end
+      :gen_tcp.send(socket, encrypted)
     rescue
       e ->
         Logger.error("Error sending packet #{inspect(packet)} in state #{connstate}: #{Exception.format(:error, e, __STACKTRACE__)}")
diff --git a/apps/amethyst/lib/apps/connection_receiver.ex b/apps/amethyst/lib/apps/connection_receiver.ex
index fd34386..3b8e033 100644
--- a/apps/amethyst/lib/apps/connection_receiver.ex
+++ b/apps/amethyst/lib/apps/connection_receiver.ex
@@ -35,7 +35,7 @@ defmodule Amethyst.ConnectionReceiver do
     {:ok, spawn(fn ->
       Process.set_label("ConnectionReceiver for #{inspect(socket)}")
       {:ok, pid} = Amethyst.ConnectionHandler.start_link(socket, Amethyst.ConnectionState.Handshake, 0)
-      receive(socket, pid, nil)
+      receive(socket, pid, nil, nil)
     end)}
   end
 
@@ -44,63 +44,88 @@ defmodule Amethyst.ConnectionReceiver do
     {:ok, spawn_link(fn ->
       Process.set_label("ConnectionReceiver for #{inspect(socket)}")
       {:ok, pid} = Amethyst.ConnectionHandler.start_link(socket, Amethyst.ConnectionState.Handshake, 0)
-      receive(socket, pid, nil)
+      receive(socket, pid, nil, nil)
     end)}
   end
 
-  @spec receive(:gen_tcp.socket(), pid(), nil | :crypto.crypto_state()) :: no_return()
-  def receive(socket, sender, cstate) do
-    case get_packet(socket, cstate) do
+  @spec receive(:gen_tcp.socket(), pid(), nil | :crypto.crypto_state(), nil | pos_integer()) :: no_return()
+  def receive(socket, sender, estate, cstate) do
+    case get_packet(socket, estate, cstate) do
       :closed -> send(sender, :closed)
         Process.exit(self(), :normal)
       {:error, error} -> Logger.error("Error reading packet: #{error}")
       {id, data} -> send(sender, {:packet, id, data})
     end
-    if cstate == nil do
-      # Ask the handler if the encryption state has changed
+
+    estate = if estate == nil do
+      # Ask the handler if we have encryption now
       send(sender, {:get_encryption, self()})
-      Logger.debug("Asking for news on encryption...")
       receive do
-        nil -> receive(socket, sender, cstate)
-        some ->
-          Logger.debug("Enabling decryption!")
-          receive(socket, sender, some)
+        nil -> nil
+        some -> some
       end
-    else
-     receive(socket, sender, cstate)
-    end
+    else estate end
+
+    cstate = if cstate == nil do
+      # Ask the handler if we have encryption now
+      send(sender, {:get_compression, self()})
+      receive do
+        nil -> nil
+        some -> some
+      end
+    else cstate end
+
+    receive(socket, sender, estate, cstate)
   end
 
-  def get_packet(client, cstate) do
-    case get_varint(client, "", cstate) do
+  def get_packet(client, estate, cstate) do
+    case get_varint(client, "", estate) do
       :closed -> :closed
       {:error, error} -> {:error, error}
       {[length], ""} ->
-        recv = :gen_tcp.recv(client, length)
-        case recv do
-          {:ok, full_packet} ->
-            full_packet = case cstate do
-              nil -> full_packet
-              ds -> :crypto.crypto_update(ds, full_packet)
+        data = :gen_tcp.recv(client, length)
+        case data do
+          {:ok, data} ->
+            # Perform decryption and decompression
+            decrypted = if estate == nil do
+              data
+            else
+              :crypto.crypto_update(estate, data)
             end
-            ({[id], data} = Read.start(full_packet) |> Read.varint() |> Read.stop()
-              {id, data})
+
+            full_packet = if cstate == nil do
+              # Using "without compression" container
+              decrypted
+            else
+              # Using "with compression" container
+              {[dlength], rest} = Read.start(decrypted) |> Read.varint |> Read.stop
+              if dlength == 0 do
+                # Uncompressed data
+                rest
+              else
+                # Compressed data
+                rest |> :zlib.uncompress()
+              end
+            end
+
+            {[id], data} = Read.start(full_packet) |> Read.varint |> Read.stop
+            {id, data}
           {:error, :closed} -> :closed
           {:error, error} -> {:error, error}
         end
     end
   end
 
-  defp get_varint(client, acc, cstate) do
+  defp get_varint(client, acc, estate) do
     case :gen_tcp.recv(client, 1) do
       {:ok, byte} ->
-        byte = case cstate do
+        byte = case estate do
           nil -> byte
           ds -> :crypto.crypto_update(ds, byte)
         end
         case byte do
           <<0::1, _::7>> -> Read.start(acc <> byte) |> Read.varint() |> Read.stop()
-          <<1::1, _::7>> -> get_varint(client, acc <> byte, cstate)
+          <<1::1, _::7>> -> get_varint(client, acc <> byte, estate)
         end
       {:error, :closed} -> :closed
       {:error, error} -> {:error, error}
diff --git a/apps/amethyst/lib/states/login.ex b/apps/amethyst/lib/states/login.ex
index a6f22fe..f5e9c3e 100644
--- a/apps/amethyst/lib/states/login.ex
+++ b/apps/amethyst/lib/states/login.ex
@@ -90,6 +90,13 @@ defmodule Amethyst.ConnectionState.Login do
     verify_token = Amethyst.Keys.decrypt(verify_token)
     if verify_token == Map.get(state, :verify_token, :never) do
       send(self(), {:set_encryption, secret})
+
+      if Application.get_env(:amethyst, :compression, nil) != nil do
+        threshold = Application.get_env(:amethyst, :compression, 0)
+        send(self(), {:send_packet, %{packet_type: :set_compression, threshold: threshold}})
+        send(self(), {:set_compression, threshold})
+      end
+
       send(self(), {:send_packet, %{
         packet_type: :login_success,
         uuid: Map.get(state, :uuid),
diff --git a/apps/example_game/lib/example/game.ex b/apps/example_game/lib/example/game.ex
index 0756f9e..62dce35 100644
--- a/apps/example_game/lib/example/game.ex
+++ b/apps/example_game/lib/example/game.ex
@@ -18,7 +18,7 @@ defmodule Example.Game do
   @impl true
   @spec player_position(any(), {any(), any(), any()}, any()) :: :ok
   def player_position(from, {x, y, z}, _refs) do
-    Logger.info("Player at #{inspect(from)} moved to #{x}, #{y}, #{z}")
+    # Logger.info("Player at #{inspect(from)} moved to #{x}, #{y}, #{z}")
     send(from, {:set_position, {x, y, z}})
     :ok
   end
diff --git a/config/runtime.exs b/config/runtime.exs
index c879757..a3c94b6 100644
--- a/config/runtime.exs
+++ b/config/runtime.exs
@@ -4,4 +4,5 @@ config :amethyst,
   port: 25599, # Bogus port for testing, avoids unexpected conflicts
   encryption: true, # Whether or not to request encryption from clients.
   auth: false, # Whether or not users should be authenticated with Mojang.
+  compression: 256, # Packets larger than this amount are sent compressed. Set to nil to disable compression.
   default_game: Example.Game # Which game new players should be sent to