NMDP 12: Recognition and Ratification of the Community Fund as Part of the Terrapin International Foundation Ecosystem Treasury

Governance Discussions Nexus Mutual DAO Proposals
1

NMDP 12: Recognition and Ratification of the Community Fund as Part of the Terrapin International Foundation Ecosystem Treasury

Field Detail
Proposal Type Nexus Mutual DAO Proposal (NMDP)
Author(s) @BraveNewDeFi / @Hugh
In Consultation with In-house Counsel Ania Szpak
Date Posted 12 March 2026
Voting Period 3 days (per standard governance timeline)
Default Outcome Approve
Quorum for Rejection 15% of NXM token supply must vote to deny
Related Proposal Original Community Fund Proposal (Forum Post #330, December 2020

1. Summary

This proposal requests that Nexus Mutual members authorise and direct the Advisory Board (AB) to formally ratify that the Nexus Mutual Community Fund (the “Community Fund”) forms part of the ecosystem treasury of Terrapin International Foundation (the “Foundation”), and to execute such resolutions and documentation as are necessary to give legal effect to that recognition.

The Community Fund was created in December 2020 by community governance vote, predating the Foundation’s establishment. It has since been administered by a multi-sig wallet and funded by commission income from Nexus Mutual’s products. Despite its operational integration with the Foundation and the DAO, no formal instrument has ever documented the Community Fund’s relationship to the Foundation’s legal structure. This proposal remedies that gap.

The default outcome of this proposal is Approve. Members wishing to prevent this action must vote to deny and meet the 15% quorum threshold.

2. Background and Context

2.1 The Original Community Fund Proposal

In December 2020, community member HeyChristopher posted a governance proposal on the Nexus Mutual forum proposing the creation of a community treasury. Following extensive community debate and strong support from the Advisory Board, the community voted to:

  • Mint 100,000 NXM via token dilution (not from existing capital pool assets)
  • Direct those tokens to a new multi-signature wallet controlled by a mix of community members, investors, and Foundation representative
  • Establish the fund for purposes including risk assessment incentives, community contributor rewards, ecosystem grants, and marketing

The vote passed. The minted NXM was sent directly to the multi-sig.

2.2 What Has Happened Since

Since its creation, the Community Fund has evolved significantly:

  • Commission income: The fund now holds and receives commission income from Nexus Mutual cover sales, making it a revenue-generating operational treasury rather than simply a dilutive grant.
  • Contractor payments: The fund has been used to pay contractors and contributors who hold legal agreements with the Foundation and the DAO after appropriate funding requests were approved by members through the NMDP process.
  • Foundation establishment: The Foundation (Terrapin International Foundation, a Panamanian foundation) was established after the Community Fund, and the Capital Pool was transferred to it. The Community Fund was not part of that transfer, correctly so, given its independent origin.
  • Continued multi-sig administration: The fund has been governed by the multi-sig signers in accordance with community governance, without formal legal documentation connecting it to the Foundation.

2.3 The Gap This Proposal Addresses

The Community Fund currently occupies an ambiguous legal position: created by and for the community, administered by community-aligned signers, operationally connected to the Foundation through contractor relationships, but without a formal instrument establishing that connection.

This proposal seeks to close that gap by giving the Advisory Board explicit member authority to ratify the Community Fund’s status and formalise its relationship with the Foundation.

3. The Proposal

3.1 What Members Are Being Asked to Authorise

Members are asked to authorise and direct the Advisory Board to:

  1. Issue a Foundation Council Resolution formally recognising the Community Fund as part of the Foundation’s ecosystem treasury structure, on terms consistent with the Community Fund’s origin, governance character, and the interests of the token holder community.
  2. Ensure governance supremacy is preserved — specifically, that no documentation executed pursuant to this proposal shall give the Foundation Council, the sole member, or any individual the power to direct, encumber, or dispose of the Community Fund without a prior valid on-chain governance vote.

3.2 What This Proposal Does Not Do

For the avoidance of doubt, this proposal does not:

  • Alter the governance mechanism by which the Community Fund is administered — on-chain governance remains supreme
  • Create any entitlement on the part of the Foundation to direct Community Fund assets
  • Affect the Capital Pool or any other Foundation treasury asset
  • Constitute legal, tax, or financial advice

4. Rationale

4.1 Why Formalisation Is Needed Now

Contractor payments under Foundation agreements, commission income, multi-sig signers with Foundation relationships — means the fund is already functionally connected to the Foundation in ways that carry various operational consequences whether documented or not. Formalising that connection on the community’s terms, with governance protections intact, is materially preferable to leaving it undocumented.

5. Implementation

5.1 Timeline

Milestone Date
Proposal posted (NMDP) 12 March 2026
Snapshot Vote posted 16 March 2026
Voting period 3 days
Post-vote timelock 24 hours

5.2 Documents to Be Executed

The AB is directed to procure execution of the following, subject to legal counsel review:

  • Foundation Council Resolution — recognising the Community Fund as an ecosystem treasury, adopting it into the Foundation’s structure, ratifying historical payments, and establishing governance supremacy provisions
  • Any other necessary documentation

6. Voting Options and Default Outcome

This proposal follows the standard Nexus Mutual optimistic governance model:

Vote Option Outcome
Approve (Default) The AB is authorised and directed to execute the actions in Section 3.1 within 60 days and report back to members.
Deny If 15% or more of NXM token supply votes to deny, the proposal does not proceed and no action is taken by the AB.

7. Questions for Community Discussion

We welcome community feedback on this proposal.

8. References and Supporting Documents

1 Like