diff --git a/lib/core/config.js b/lib/core/config.js
index fc7c2847..883a58ef 100644
--- a/lib/core/config.js
+++ b/lib/core/config.js
@@ -75,19 +75,24 @@ Config.prototype.loadBlockchainConfigFile = function() {
 Config.prototype.loadContractsConfigFile = function() {
 
   var configObject = {
-    "versions": {
-      "web3.js": "0.19.1",
-      "solc": "0.4.17"
-    },
-    "deployment": {
-      "host": "localhost",
-      "port": 8545,
-      "type": "rpc"
-    },
-    "dappConnection": [
-      "$WEB3",
-      "localhost:8545"
-    ]
+    "default": {
+      "versions": {
+        "web3.js": "1.0.0-beta",
+        "solc": "0.4.17"
+      },
+      "deployment": {
+        "host": "localhost",
+        "port": 8545,
+        "type": "rpc"
+      },
+      "dappConnection": [
+        "$WEB3",
+        "localhost:8545"
+      ],
+      "gas": "auto",
+      "contracts": {
+      }
+    }
   };
 
   var configPlugins = this.plugins.getPluginsFor('contractsConfig');
@@ -99,8 +104,11 @@ Config.prototype.loadContractsConfigFile = function() {
     });
   }
 
-  var contractsConfig = fs.readJSONSync(this.configDir + "contracts.json");
-  configObject = utils.recursiveMerge(configObject, contractsConfig);
+  var contractsConfig;
+  if (fs.existsSync(this.configDir + "contracts.json")) {
+    contractsConfig = fs.readJSONSync(this.configDir + "contracts.json");
+    configObject = utils.recursiveMerge(configObject, contractsConfig);
+  }
   var defaultContractsConfig = configObject['default'];
   var envContractsConfig = configObject[this.env];
 
diff --git a/test/config.js b/test/config.js
index cffc1f63..eb04d970 100644
--- a/test/config.js
+++ b/test/config.js
@@ -36,6 +36,9 @@ describe('embark.Config', function() {
     it('should load contract config correctly', function() {
         config.loadContractsConfigFile();
         let expectedConfig = {
+          versions: { 'web3.js': '1.0.0-beta', solc: '0.4.17' },
+          deployment: { host: 'localhost', port: 8545, type: 'rpc' },
+          dappConnection: [ '$WEB3', 'localhost:8545' ],
           "gas": "auto",
           "contracts": {
             "SimpleStorage": {