We describe a fully scalable wavelet-based 2D+t (in-band) video coding architecture. We propose new coding tools specifically designed for this framework aimed at two goals: reduce the computational complexity at the encoder without sacrificing compression; improve the coding efficiency, especially at low bitrates. To this end, we focus our attention on motion estimation and motion vector encoding. We propose a fast motion estimation algorithm that works in the wavelet domain and exploits the geometrical properties of the wavelet subbands. We show that the computational complexity grows linearly with the size of the search window, yet approaching the performance of a full search strategy. We extend the proposed motion estimation algorithm to work with blocks of variable sizes, in order to better capture local motion characteristics, thus improving in terms of rate-distortion behavior. Given this motion field representation, we propose a motion vector coding algorithm that allows to adaptively scale the motion bit budget according to the target bitrate, improving the coding efficiency at low bitrates. Finally, we show how to optimally scale the motion field when the sequence is decoded at reduced spatial resolution. Experimental results illustrate the advantages of each individual coding tool presented in this paper. Based on these simulations, we define the best configuration of coding parameters and we compare the proposed codec with MC-EZBC, a widely used reference codec implementing the t+2D framework.