What Is a WrappedNXM (wNXM)?
WrappedNXM (wNXM) is a 1-to-1 backed token generated by wrapping genuine NXM. In brief, wrapped tokens are the cryptocurrencies that are pegged or attached to the value of another crypto or assets. Thus, it bypasses the limitation of transferring native coins, i.e., tokens that reside on native blockchains. Here, NXM is an ERC20-compatible token of the Nexus Mutual protocol, a decentralized alternative to insurance. Nexus Mutual is a digital cooperative that complies with the relevant laws and regulations of the country from where it accepts members. The project aims to provide the community members with simple, transparent, accessible, and affordable financial protection against their risks. Although fully tradable, wNXM cannot be used within the Nexus Mutual platform. Since NXM is traded only among members, only Nexus Mutual members can wrap/unwrap NXM.
According to the website, the key features of the NXM project seek to be the following:
Governance: The NXM token represents the ownership of the mutual’s capital to its members, who can vote on proposals or put forward governance proposals.
Capital Provision: After paying a nominal fee for membership, members can contribute to the pool by purchasing smart contract cover. Besides this, they can purchase NXM tokens to contribute directly to the pool.
Risk Assessment: Members can stake against the security of the custodian or protocol and get rewarded for their staking. They can even vote to change the staking system for risk assessors, allowing assessors to claim rewards while reducing gas costs.
Claim Assessment: Members can vote for claim payments and resolve them within 12–48 hours and, in return, get rewarded. Besides this, members can stake NXM to assess claims submitted by other members.
Audits & Security: In addition to external reviews during the build phase, three independent experts aim to review the code through a solidified audit. Further, the platform seeks to provide additional security against smart contract failure and exchange hacks.
In addition, the NXM token aims to bind together the internal economics of the mutual by seeking to reward the active members for participating in the day-to-day operations of the mutual. Besides this, token-driven economic incentives aim to enforce claims payments. Token also works as a capital provider to the mutual. As the mutual’s capital pool increases, the value of NXM seeks to also increase.
History of WrappedNXM (wNXM)
Nexus Mutual was founded by Hugh Karp. He is an insurance professional with experience in a broad range of insurance and reinsurance roles. Also, he has been a blockchain enthusiast since 2011.
