NXM is the governance token for the Nexus Mutual protocol. It is used to buy cover, vote on governance decisions, and participate in Risk and Claims Assessments. It is also used to encourage capital provision and represents ownership to the mutual’s capital. As the mutual’s capital pool increases, the value of NXM will increase as well.
The token’s price is determined using a bonding curve which is affected by both the amount of capital the mutual has and the amount of capital it needs to meet all claims with a certain probability.