Core deposit retention measures how effectively a financial institution keeps its primary customer deposits. This metric indicates the stability of a bank’s funding base, representing the portion of customer deposits that remain consistently within the institution over time. High retention rates suggest strong customer loyalty and a reliable source of low-cost capital for lending and investment activities. It is a key indicator of financial health and operational stability.
Context
While traditionally a banking term, the concept of retaining deposited value holds relevance in the digital asset space concerning stablecoins and decentralized finance (DeFi) protocols. Understanding how users maintain their funds within specific digital ecosystems helps assess platform stability and user confidence. Future analysis may adapt this metric to evaluate the stickiness of liquidity pools or stablecoin holdings within various crypto applications.
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