[RFC]: Capital Pool and/or Risk Assessment Model Bounty

One of the more confusing aspects for prospective and new members is how the capital pool operates. Though we have a comprehensive write up in the documentation and a separate Token Model page, it’s hard for most people to visualize how the amount of capital in the pool impacts the MCR% and how a greater MCR% impacts the price of NXM in terms of ETH value.

What do members think about creating an NXM bounty for anyone who can build an interactive model that allows a user to change the MCR% and see the change in NXM price (as valued in ETH)?

Users could simulate an addition of 1,000 ETH to the capital pool or a claim payout of 1,000 ETH from the capital pool to members. I think this would make the fundamentals behind the mutual more accessible for members.

There are a number of inputs that would be helpful to illustrate using this kind of a model for the MCR and Capital Model:

  • The impact an addition or reduction of capital has on the MCR% and NXM price.
  • The formulas behind the bonding curve and token price in dynamic action.

Another model that simulates the Risk Assessment process by changing the amount of staked NXM would be helpful, too. Users could see the difference another 1,000 NXM staked against Bancor would have on capacity (for example).

There are a number of inputs that would be helpful to illustrate using this kind of a model for Risk Assessment:

We could have these interactive models added to the docs or to the Token Model page. I’m sure @Kayleigh-NexusMutual or @Hugh would have better insight on where to best place these.

What does everyone think? Would this be a good use of Community Funds? Would other members find this helpful, AND do members think this educational tool would help us educate prospective members in the coming months?


Something like this? I’m not sure how useful the graph is by itself, but with an accompanying video guide it could be helpful I suppose

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It’s not so much the representation of the bonding curve. We already have that in the Token Model. What I’m thinking is a set bonding curve with the various formulas built into the model that members can play with (i.e. change the amount of ETH in the capital pool) to see the impact of MCR% and price.

We’d also do this for the Risk Assessment process to see how available cover would be impacted by the amount of NXM staked.


I think this could be done relatively easy with a google sheet. But why do you think that this is a particular road block for new members of Nexus Mutual?

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I think there are many prospective members who cannot visualize how the capital model works and how the Risk Assessment process works to open up cover. I am basing this on the number of questions I answer regarding these two concepts on Discord and Twitter.

Having an interactive model that users could manipulate and see the impact on pricing and cover availability would be a way to demonstrate how the system works for users who are not receptive to longform explanations. I think a nominal bounty for such a feature would help reduce friction when new or prospective members are trying to understand these two concepts/processes.

I’m going to work on creating greater awareness about the Risk Assessment process, and I’m currently working on a Risk Assessment Resources section for the GitBook, which will help members identify tools and concepts to use when deciding to act as a Risk Assessor.

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Agree on this point. We would just need to find someone who can build it and get them to apply for a community grant! :turtle:

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Good idea BND and @derpxes

Is it something that Gauntlet could build?

I’m intrigued after having recently read a post on DAOs by their CEO with a demo of what they do for Aave and other protocols…


  1. get some specs together
  2. ask for a quote + advice?
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There’s always a Lego for something you need! This is an awesome resource. I will learn a little bit more about Gaunlet and figure out next steps.

Thank you, @oSaaT!

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