diff --git a/CHANGELOG.md b/CHANGELOG.md
new file mode 100644
index 0000000..3dd5614
--- /dev/null
+++ b/CHANGELOG.md
@@ -0,0 +1,41 @@
+<!--
+Guiding Principles:
+
+Changelogs are for humans, not machines.
+There should be an entry for every single version.
+The same types of changes should be grouped.
+Versions and sections should be linkable.
+The latest version comes first.
+The release date of each version is displayed.
+Mention whether you follow Semantic Versioning.
+
+Usage:
+
+Change log entries are to be added to the Unreleased section under the
+appropriate stanza (see below). Each entry is required to include a tag and
+the Github issue reference in the following format:
+
+* (<tag>) \#<issue-number> message
+
+The tag should consist of where the change is being made ex. (x/staking), (store)
+The issue numbers will later be link-ified during the release process so you do
+not have to worry about including a link manually, but you can if you wish.
+
+Types of changes (Stanzas):
+
+"Features" for new features.
+"Improvements" for changes in existing functionality.
+"Deprecated" for soon-to-be removed features.
+"Bug Fixes" for any bug fixes.
+"KVIndexer Breaking" for breaking KVIndexer module.
+"Submodule Breaking" for breaking submodules
+Ref: https://keepachangelog.com/en/1.0.0/
+-->
+
+# Changelog
+
+## [Unreleased]
+
+### KVIndexer breaking 
+
+* (cache) [#48](https://github.com/initia-labs/kvindexer/pull/48) Replace record-count-based lru cache with capacity-based one
diff --git a/config/config.go b/config/config.go
index babaa33..76d0a58 100644
--- a/config/config.go
+++ b/config/config.go
@@ -11,9 +11,9 @@ import (
 )
 
 const (
-	flagIndexerEnable    = "indexer.enable"
-	flagIndexerBackend   = "indexer.backend"
-	flagIndexerCacheSize = "indexer.cache-size"
+	flagIndexerEnable        = "indexer.enable"
+	flagIndexerBackend       = "indexer.backend"
+	flagIndexerCacheCapacity = "indexer.cache-capacity"
 )
 
 func NewConfig(appOpts servertypes.AppOptions) (*IndexerConfig, error) {
@@ -23,7 +23,7 @@ func NewConfig(appOpts servertypes.AppOptions) (*IndexerConfig, error) {
 	if !cfg.Enable {
 		return cfg, nil
 	}
-	cfg.CacheSize = cast.ToUint(appOpts.Get(flagIndexerCacheSize))
+	cfg.CacheCapacity = cast.ToInt(appOpts.Get(flagIndexerCacheCapacity))
 
 	cfg.BackendConfig = viper.New()
 	err := cfg.BackendConfig.MergeConfigMap(cast.ToStringMap(appOpts.Get(flagIndexerBackend)))
@@ -31,7 +31,7 @@ func NewConfig(appOpts servertypes.AppOptions) (*IndexerConfig, error) {
 		return nil, fmt.Errorf("failed to merge backend config: %w", err)
 	}
 
-	cfg.CacheSize = cast.ToUint(appOpts.Get(flagIndexerCacheSize))
+	cfg.CacheCapacity = cast.ToInt(appOpts.Get(flagIndexerCacheCapacity))
 
 	return cfg, nil
 }
@@ -41,8 +41,8 @@ func (c IndexerConfig) Validate() error {
 		return nil
 	}
 
-	if c.CacheSize == 0 {
-		return fmt.Errorf("cache size must be greater than 0")
+	if c.CacheCapacity == 0 {
+		return fmt.Errorf("cache capacity must be greater than 0")
 	}
 
 	if c.BackendConfig == nil {
@@ -59,7 +59,7 @@ func (c IndexerConfig) IsEnabled() bool {
 func DefaultConfig() IndexerConfig {
 	return IndexerConfig{
 		Enable:        true,
-		CacheSize:     100_000,
+		CacheCapacity: 500 * 1024 * 1024, // 500MiB
 		BackendConfig: store.DefaultConfig(),
 	}
 }
diff --git a/config/types.go b/config/types.go
index 342a53f..dc43bfe 100644
--- a/config/types.go
+++ b/config/types.go
@@ -6,7 +6,7 @@ import (
 
 type IndexerConfig struct {
 	Enable        bool         `mapstructure:"indexer.enable"`
-	CacheSize     uint         `mapstructure:"indexer.cache-size"`
+	CacheCapacity int          `mapstructure:"indexer.cache-capacity"`
 	BackendConfig *viper.Viper `mapstructure:"indexer.backend"`
 }
 
@@ -20,8 +20,8 @@ const DefaultConfigTemplate = `
 # Enable defines whether the indexer is enabled.
 enable = {{ .IndexerConfig.Enable }}
 
-# CacheSize defines the size of the cache.
-cache-size = {{ .IndexerConfig.CacheSize }}
+# CacheCapacity defines the size of the cache. (unit: bytes)
+cache-capacity = {{ .IndexerConfig.CacheCapacity }}
 
 # Backend defines the type of the backend store and its options.
 # It should have a key-value pair named 'type', and the value should exist in store supported by cosmos-db.
diff --git a/go.mod b/go.mod
index fe16827..24b0220 100644
--- a/go.mod
+++ b/go.mod
@@ -9,6 +9,7 @@ require (
 	cosmossdk.io/core v0.11.0
 	cosmossdk.io/log v1.3.1
 	cosmossdk.io/store v1.0.2
+	github.com/allegro/bigcache/v3 v3.1.0
 	github.com/cometbft/cometbft v0.38.5
 	github.com/cosmos/cosmos-db v1.0.2
 	github.com/cosmos/cosmos-sdk v0.50.5
@@ -24,10 +25,12 @@ require (
 	google.golang.org/grpc v1.62.0
 )
 
+require github.com/hashicorp/golang-lru v1.0.2 // indirect
+
 require (
 	cosmossdk.io/api v0.7.3 // indirect
 	cosmossdk.io/depinject v1.0.0-alpha.4 // indirect
-	cosmossdk.io/errors v1.0.1 // indirect
+	cosmossdk.io/errors v1.0.1
 	cosmossdk.io/math v1.3.0 // indirect
 	cosmossdk.io/x/tx v0.13.1 // indirect
 	filippo.io/edwards25519 v1.0.0 // indirect
@@ -90,7 +93,6 @@ require (
 	github.com/hashicorp/go-metrics v0.5.2 // indirect
 	github.com/hashicorp/go-plugin v1.5.2 // indirect
 	github.com/hashicorp/go-uuid v1.0.2 // indirect
-	github.com/hashicorp/golang-lru v1.0.2
 	github.com/hashicorp/hcl v1.0.0 // indirect
 	github.com/hashicorp/yamux v0.1.1 // indirect
 	github.com/hdevalence/ed25519consensus v0.1.0 // indirect
diff --git a/go.sum b/go.sum
index 3312dd4..571f09a 100644
--- a/go.sum
+++ b/go.sum
@@ -42,6 +42,8 @@ github.com/alecthomas/template v0.0.0-20190718012654-fb15b899a751/go.mod h1:LOuy
 github.com/alecthomas/units v0.0.0-20151022065526-2efee857e7cf/go.mod h1:ybxpYRFXyAe+OPACYpWeL0wqObRcbAqCMya13uyzqw0=
 github.com/alecthomas/units v0.0.0-20190717042225-c3de453c63f4/go.mod h1:ybxpYRFXyAe+OPACYpWeL0wqObRcbAqCMya13uyzqw0=
 github.com/alecthomas/units v0.0.0-20190924025748-f65c72e2690d/go.mod h1:rBZYJk541a8SKzHPHnH3zbiI+7dagKZ0cgpgrD7Fyho=
+github.com/allegro/bigcache/v3 v3.1.0 h1:H2Vp8VOvxcrB91o86fUSVJFqeuz8kpyyB02eH3bSzwk=
+github.com/allegro/bigcache/v3 v3.1.0/go.mod h1:aPyh7jEvrog9zAwx5N7+JUQX5dZTSGpxF1LAR4dr35I=
 github.com/antihax/optional v1.0.0/go.mod h1:uupD/76wgC+ih3iEmQUL+0Ugr19nfwCT1kdvxnR2qWY=
 github.com/apache/thrift v0.12.0/go.mod h1:cp2SuWMxlEZw2r+iP2GNCdIi4C1qmUzdZFSVb+bacwQ=
 github.com/apache/thrift v0.13.0/go.mod h1:cp2SuWMxlEZw2r+iP2GNCdIi4C1qmUzdZFSVb+bacwQ=
diff --git a/store/cache_kvstore.go b/store/cache_kvstore.go
index a816f10..18a2477 100644
--- a/store/cache_kvstore.go
+++ b/store/cache_kvstore.go
@@ -1,22 +1,28 @@
 package store
 
 import (
-	"fmt"
+	"context"
 
+	"cosmossdk.io/errors"
 	cachekv "cosmossdk.io/store/cachekv"
 	"cosmossdk.io/store/types"
-	lru "github.com/hashicorp/golang-lru"
+	bigcache "github.com/allegro/bigcache/v3"
 )
 
 type CacheStore struct {
 	store types.CacheKVStore
-	cache *lru.ARCCache
+	cache *bigcache.BigCache
 }
 
-func NewCacheStore(store types.KVStore, size uint) *CacheStore {
-	cache, err := lru.NewARC(int(size))
+func NewCacheStore(store types.KVStore, capacity int) *CacheStore {
+	// default with no eviction and custom hard max cache capacity
+	cacheCfg := bigcache.DefaultConfig(0)
+	cacheCfg.Verbose = false
+	cacheCfg.HardMaxCacheSize = capacity
+
+	cache, err := bigcache.New(context.Background(), cacheCfg)
 	if err != nil {
-		panic(fmt.Errorf("failed to create KVStore cache: %s", err))
+		panic(err)
 	}
 
 	return &CacheStore{
@@ -28,36 +34,45 @@ func NewCacheStore(store types.KVStore, size uint) *CacheStore {
 func (c CacheStore) Get(key []byte) ([]byte, error) {
 	types.AssertValidKey(key)
 
-	v, ok := c.cache.Get(string(key))
-	if ok {
-		// cache hit
-		return v.([]byte), nil
+	v, err := c.cache.Get(string(key))
+	// cache hit
+	if err == nil {
+		return v, nil
 	}
 
-	// write to cache
+	// get from store and write to cache
 	value := c.store.Get(key)
-	c.cache.Add(string(key), value)
+	err = c.cache.Set(string(key), value)
+	if err != nil {
+		return nil, errors.Wrap(err, "failed to set cache")
+	}
 
 	return value, nil
 }
 
 func (c CacheStore) Has(key []byte) (bool, error) {
-	_, ok := c.cache.Get(string(key))
-	return ok, nil
+	_, err := c.cache.Get(string(key))
+	return err == nil, err
 }
 
 func (c CacheStore) Set(key, value []byte) error {
 	types.AssertValidKey(key)
 	types.AssertValidValue(value)
 
-	c.cache.Add(string(key), value)
+	err := c.cache.Set(string(key), value)
+	if err != nil {
+		return errors.Wrap(err, "failed to set cache")
+	}
 	c.store.Set(key, value)
 
 	return nil
 }
 
 func (c CacheStore) Delete(key []byte) error {
-	c.cache.Remove(string(key))
+	err := c.cache.Delete(string(key))
+	if err != nil && errors.IsOf(err, bigcache.ErrEntryNotFound) {
+		return errors.Wrap(err, "failed to delete cache")
+	}
 	c.store.Delete(key)
 
 	return nil
diff --git a/x/kvindexer/keeper/keeper.go b/x/kvindexer/keeper/keeper.go
index dc90250..1beb020 100644
--- a/x/kvindexer/keeper/keeper.go
+++ b/x/kvindexer/keeper/keeper.go
@@ -108,7 +108,7 @@ func (k *Keeper) Seal() error {
 	k.db = db
 	k.schema = &schema
 
-	k.store = store.NewCacheStore(dbadapter.Store{DB: db}, k.config.CacheSize)
+	k.store = store.NewCacheStore(dbadapter.Store{DB: db}, k.config.CacheCapacity)
 	k.sealed = true
 
 	return nil