diff --git a/app/src/main/java/com/babylon/wallet/android/presentation/accessfactorsources/derivepublickey/DerivePublicKeyDialog.kt b/app/src/main/java/com/babylon/wallet/android/presentation/accessfactorsources/derivepublickey/DerivePublicKeyDialog.kt
index e31ce0b58e..4846dacad7 100644
--- a/app/src/main/java/com/babylon/wallet/android/presentation/accessfactorsources/derivepublickey/DerivePublicKeyDialog.kt
+++ b/app/src/main/java/com/babylon/wallet/android/presentation/accessfactorsources/derivepublickey/DerivePublicKeyDialog.kt
@@ -1,5 +1,6 @@
 package com.babylon.wallet.android.presentation.accessfactorsources.derivepublickey
 
+import androidx.activity.compose.BackHandler
 import androidx.compose.foundation.background
 import androidx.compose.foundation.layout.Column
 import androidx.compose.foundation.layout.Spacer
@@ -45,6 +46,10 @@ fun DerivePublicKeyDialog(
     val state by viewModel.state.collectAsState()
     val context = LocalContext.current
 
+    BackHandler {
+        viewModel.onUserDismiss()
+    }
+
     LaunchedEffect(Unit) {
         viewModel.oneOffEvent.collect { event ->
             when (event) {
@@ -58,6 +63,7 @@ fun DerivePublicKeyDialog(
                     }
                 }
                 DerivePublicKeyViewModel.Event.AccessingFactorSourceCompleted -> onDismiss()
+                DerivePublicKeyViewModel.Event.UserDismissed -> onDismiss()
             }
         }
     }
@@ -66,7 +72,7 @@ fun DerivePublicKeyDialog(
         modifier = modifier,
         showContentForFactorSource = state.showContentForFactorSource,
         shouldShowRetryButton = state.shouldShowRetryButton,
-        onDismiss = onDismiss,
+        onDismiss = viewModel::onUserDismiss,
         onRetryClick = viewModel::onRetryClick
     )
 }
@@ -81,9 +87,7 @@ private fun DerivePublicKeyBottomSheetContent(
 ) {
     BottomSheetDialogWrapper(
         modifier = modifier,
-        onDismiss = {
-            onDismiss()
-        }
+        onDismiss = onDismiss
     ) {
         Column(
             modifier = Modifier
diff --git a/app/src/main/java/com/babylon/wallet/android/presentation/accessfactorsources/derivepublickey/DerivePublicKeyViewModel.kt b/app/src/main/java/com/babylon/wallet/android/presentation/accessfactorsources/derivepublickey/DerivePublicKeyViewModel.kt
index 5d25212913..57859ccfa1 100644
--- a/app/src/main/java/com/babylon/wallet/android/presentation/accessfactorsources/derivepublickey/DerivePublicKeyViewModel.kt
+++ b/app/src/main/java/com/babylon/wallet/android/presentation/accessfactorsources/derivepublickey/DerivePublicKeyViewModel.kt
@@ -21,6 +21,7 @@ import com.radixdlt.sargon.PublicKey
 import com.radixdlt.sargon.extensions.init
 import com.radixdlt.sargon.extensions.string
 import dagger.hilt.android.lifecycle.HiltViewModel
+import kotlinx.coroutines.CancellationException
 import kotlinx.coroutines.Job
 import kotlinx.coroutines.flow.update
 import kotlinx.coroutines.launch
@@ -114,6 +115,16 @@ class DerivePublicKeyViewModel @Inject constructor(
         }
     }
 
+    fun onUserDismiss() {
+        viewModelScope.launch {
+            derivePublicKeyJob?.cancel()
+            accessFactorSourcesUiProxy.setOutput(
+                output = AccessFactorSourcesOutput.Failure(CancellationException("User cancelled"))
+            )
+            sendEvent(Event.UserDismissed)
+        }
+    }
+
     private suspend fun derivePublicKey(): Result<Unit> {
         return when (val factorSource = input.factorSource) {
             is FactorSource.Device -> {
@@ -192,5 +203,6 @@ class DerivePublicKeyViewModel @Inject constructor(
     sealed interface Event : OneOffEvent {
         data object RequestBiometricPrompt : Event
         data object AccessingFactorSourceCompleted : Event
+        data object UserDismissed : Event
     }
 }
diff --git a/app/src/main/java/com/babylon/wallet/android/presentation/account/createaccount/CreateAccountViewModel.kt b/app/src/main/java/com/babylon/wallet/android/presentation/account/createaccount/CreateAccountViewModel.kt
index 63214d517c..24815e8dbd 100644
--- a/app/src/main/java/com/babylon/wallet/android/presentation/account/createaccount/CreateAccountViewModel.kt
+++ b/app/src/main/java/com/babylon/wallet/android/presentation/account/createaccount/CreateAccountViewModel.kt
@@ -22,6 +22,8 @@ import com.radixdlt.sargon.FactorSource
 import com.radixdlt.sargon.extensions.asGeneral
 import com.radixdlt.sargon.extensions.string
 import dagger.hilt.android.lifecycle.HiltViewModel
+import kotlinx.coroutines.CancellationException
+import kotlinx.coroutines.Job
 import kotlinx.coroutines.flow.filterIsInstance
 import kotlinx.coroutines.flow.first
 import kotlinx.coroutines.flow.update
@@ -63,6 +65,8 @@ class CreateAccountViewModel @Inject constructor(
     val buttonEnabled = savedStateHandle.getStateFlow(CREATE_ACCOUNT_BUTTON_ENABLED, false)
     val isAccountNameLengthMoreThanTheMax = savedStateHandle.getStateFlow(IS_ACCOUNT_NAME_LENGTH_MORE_THAN_THE_MAX, false)
 
+    private var accessFactorSourcesJob: Job? = null
+
     override fun initialState(): CreateAccountUiState = CreateAccountUiState(
         isFirstAccount = args.requestSource?.isFirstTime() == true
     )
@@ -115,40 +119,43 @@ class CreateAccountViewModel @Inject constructor(
     }
 
     // when called the access factor source bottom sheet dialog is presented
-    private suspend fun accessFactorSourceForAccountCreation(
+    private fun accessFactorSourceForAccountCreation(
         isFirstAccount: Boolean,
         isWithLedger: Boolean
     ) {
-        val selectedFactorSource = if (isWithLedger) { // then get the selected ledger device
-            sendEvent(CreateAccountEvent.AddLedgerDevice)
-            appEventBus.events
-                .filterIsInstance<AppEvent.AccessFactorSources.SelectedLedgerDevice>()
-                .first()
-                .ledgerFactorSource
-        } else {
-            getProfileUseCase().mainBabylonFactorSource ?: return
-        }
+        accessFactorSourcesJob?.cancel()
+        accessFactorSourcesJob = viewModelScope.launch {
+            val selectedFactorSource = if (isWithLedger) { // then get the selected ledger device
+                sendEvent(CreateAccountEvent.AddLedgerDevice)
+                appEventBus.events
+                    .filterIsInstance<AppEvent.AccessFactorSources.SelectedLedgerDevice>()
+                    .first()
+                    .ledgerFactorSource
+            } else {
+                getProfileUseCase().mainBabylonFactorSource ?: return@launch
+            }
 
-        accessFactorSourcesProxy.getPublicKeyAndDerivationPathForFactorSource(
-            accessFactorSourcesInput = AccessFactorSourcesInput.ToDerivePublicKey(
-                forNetworkId = args.networkIdToSwitch ?: getProfileUseCase().currentGateway.network.id,
-                factorSource = selectedFactorSource,
-                isBiometricsProvided = isFirstAccount
-            )
-        ).onSuccess {
-            handleAccountCreation { nameOfAccount ->
-                val factorSourceId = when (selectedFactorSource) {
-                    is FactorSource.Device -> selectedFactorSource.value.id.asGeneral()
-                    is FactorSource.Ledger -> selectedFactorSource.value.id.asGeneral()
-                }
-                createAccountUseCase(
-                    displayName = DisplayName(nameOfAccount),
-                    factorSourceId = factorSourceId,
-                    hdPublicKey = it.value
+            accessFactorSourcesProxy.getPublicKeyAndDerivationPathForFactorSource(
+                accessFactorSourcesInput = AccessFactorSourcesInput.ToDerivePublicKey(
+                    forNetworkId = args.networkIdToSwitch ?: getProfileUseCase().currentGateway.network.id,
+                    factorSource = selectedFactorSource,
+                    isBiometricsProvided = isFirstAccount
                 )
+            ).onSuccess {
+                handleAccountCreation { nameOfAccount ->
+                    val factorSourceId = when (selectedFactorSource) {
+                        is FactorSource.Device -> selectedFactorSource.value.id.asGeneral()
+                        is FactorSource.Ledger -> selectedFactorSource.value.id.asGeneral()
+                    }
+                    createAccountUseCase(
+                        displayName = DisplayName(nameOfAccount),
+                        factorSourceId = factorSourceId,
+                        hdPublicKey = it.value
+                    )
+                }
+            }.onFailure { throwable ->
+                handleAccountCreationError(throwable)
             }
-        }.onFailure { throwable ->
-            handleAccountCreationError(throwable)
         }
     }
 
@@ -160,6 +167,9 @@ class CreateAccountViewModel @Inject constructor(
                 if (throwable is ProfileException.NoMnemonic) {
                     state.copy(shouldShowNoMnemonicError = true)
                 } else {
+                    if (throwable is CancellationException) { // user cancelled, don't print it
+                        return
+                    }
                     state.copy(
                         uiMessage = UiMessage.ErrorMessage(throwable)
                     )