diff --git a/packages/assets-controller/CHANGELOG.md b/packages/assets-controller/CHANGELOG.md
index 3e9c4373da..83b9ce3b7b 100644
--- a/packages/assets-controller/CHANGELOG.md
+++ b/packages/assets-controller/CHANGELOG.md
@@ -7,6 +7,10 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 ## [Unreleased]
 
+### Added
+
+- Add `MERGE_BALANCES_IGNORE_LIST` is `balances.ts` selectors with Arc ERC20 USDC to ignore in balance total ([#9277](https://github.com/MetaMask/core/pull/9277))
+
 ### Changed
 
 - Bump `@metamask/transaction-controller` from `^68.1.1` to `^68.2.0` ([#9253](https://github.com/MetaMask/core/pull/9253))
diff --git a/packages/assets-controller/src/selectors/balance.ts b/packages/assets-controller/src/selectors/balance.ts
index bd354714ff..5b408e8864 100644
--- a/packages/assets-controller/src/selectors/balance.ts
+++ b/packages/assets-controller/src/selectors/balance.ts
@@ -25,6 +25,10 @@ import type {
 // ============================================================================
 const TRACE_AGGREGATED_BALANCE_SELECTOR = 'AggregatedBalanceSelector';
 
+const MERGE_BALANCES_IGNORE_LIST = [
+  'eip155:5042/erc20:0x3600000000000000000000000000000000000000',
+];
+
 export type EnabledNetworkMap =
   | Record<string, Record<string, boolean>>
   | undefined;
@@ -218,7 +222,10 @@ function mergeBalancesIntoMap(args: {
     }
     const typedAssetId = assetId as Caip19AssetId;
 
-    if (assetPreferences?.[typedAssetId]?.hidden) {
+    if (
+      assetPreferences?.[typedAssetId]?.hidden ||
+      MERGE_BALANCES_IGNORE_LIST.includes(typedAssetId)
+    ) {
       continue;
     }