L2Beat has cut about $7 billion in RAIN from Arbitrum’s Total Value Secured after determining that the tokens were sitting in project-controlled multisignature wallets and should not have been counted. The move sharply reduced Arbitrum’s reported TVS, but L2Beat said the change reflected revised methodology rather than any exploit, withdrawal, or loss of funds.

Methodology Change Drives TVS Decline

According to the analytics and research platform, the excluded RAIN tokens were non-circulating and under project control. On that basis, L2Beat removed them from Arbitrum’s TVS calculation, arguing that such holdings do not represent economic value secured through open-market ownership.

The adjustment immediately lowered Arbitrum’s displayed TVS. L2Beat stressed that the drop did not mean capital had left the network. Instead, it was the result of reclassifying which assets should be included in the metric.

RAIN Still Leads Arbitrum by Secured Value

Even after the revision, RAIN remains Arbitrum’s largest asset by secured value on L2Beat’s figures. About $2.6 billion in RAIN is still counted in the network’s TVS, ahead of roughly $2.5 billion in USDC and about $1.4 billion in ETH.

That remaining total has kept attention on how the token is valued and who controls its supply. A researcher at L2Beat described the situation as “clearly absurd” and said the token appeared to be heavily manipulated, underscoring the platform’s skepticism around the asset’s reported value.

Operating Metrics Raise Further Questions

The valuation debate has also been sharpened by operating data cited from DeFiLlama. The platform reports around $26.8 million in total value locked for Rain, alongside $137,308 in 30-day decentralized exchange volume.

DeFiLlama also lists about $462,721 in 30-day DEX notional volume. Annualized protocol revenue and earnings are shown at roughly $899,000. At the same time, the site places RAIN’s market capitalization near $9.48 billion and its fully diluted valuation at around $16.48 billion.

That gap between operating activity and headline valuation has increased scrutiny of token concentration, circulating supply, and how limited trading activity can influence the value attributed to network assets.

Broader Debate Over TVS Measurement

The RAIN adjustment has renewed discussion around how analytics platforms should measure Total Value Secured, especially when large token balances are concentrated in wallets controlled by a project itself. In such cases, a network’s TVS can appear significantly larger even if those tokens are not broadly circulating.

L2Beat’s position is that project-controlled holdings should be excluded when they do not reflect market-held assets. The case leaves RAIN still contributing billions of dollars to Arbitrum’s TVS, while also intensifying debate over token ownership, valuation methods, and transparency in Layer-2 ecosystems.

Source: Coin Edition