Arbitrum remains under heavy pressure. Since the start of 2026, ARB has lost about 40% of its value, adding to a decline of more than 70% in 2025. Last month, the token fell below $0.20 and set a fresh all-time low. On-chain data shows that every current ARB holder is sitting at a loss, a condition that keeps sentiment fragile and raises the hurdle for any sustained rebound.
Liquidity data, though, is not entirely moving in the same direction as price. DeFiLlama figures show that the value of stablecoins circulating on Arbitrum increased by nearly 2% over the past week to around $65 million. USD Coin (USDC) gained share by 3% and now makes up 56.8% of stablecoin liquidity on the network. Money is coming in at the margin. Broad confidence is not.
Stablecoin balances rise while TVL stays weak
The increase in stablecoin deposits suggests that on-chain liquidity has not disappeared from Arbitrum. Still, total value locked remains near multimonth lows, which points to continued capital leakage and soft user engagement. That split matters. A chain can show pockets of incoming liquidity and still struggle to retain assets in protocols, and that is the picture reflected in the current data.
For ARB, low TVL also means less protection against sharp swings. With fewer assets committed to the network, the market has a thinner buffer when selling accelerates. The result is a setup where short-term pressure can carry more weight than isolated improvements in liquidity.
RWA is emerging as a strategic focus
Across the industry, blockchain projects are shifting attention away from pure speculation and toward activity tied to real-world value. Artificial intelligence, DeFi, and asset tokenization are drawing capital and development interest, and Arbitrum is trying to align with that shift. One example is ETHZilla’s Eurus Aero Token I on Arbitrum, which offers tokenized exposure to revenue generated by jet engines leased to an American airline.
The broader RWA market is also expanding quickly. The source material puts total RWA assets at a record $24.7 billion. Gold-backed stablecoins are part of that move, with Tether Gold (XAUT) passing $6 billion. Large asset managers have also accelerated tokenization initiatives at the start of 2026, signaling stronger institutional interest in blockchain-based investment products.
Confidence remains the key missing piece
For Arbitrum, this creates a possible opening. Rising stablecoin liquidity and projects such as ETHZilla support a push toward RWA-related activity that could attract institutional capital. Even so, the immediate obstacle is still confidence. With all ARB holders underwater, the risk of capitulation continues to hang over the token and limits how far sentiment can recover on early signs of improvement.
That leaves Arbitrum in a split state. Price action remains historically weak, while fundamental signals show selective areas of progress, mainly in stablecoin liquidity and RWA positioning. The next test is not just whether more capital enters the network, but whether that capital stays, gets deployed on-chain, and translates into visible utility.