By not ratting out Gus to the cartel,
There's definitely a relationship of love and respect between Nacho and Mike. But in that final moment, Nacho transcends that relationship and takes matters into his own hands. It's in that final speech, that he assures us he's done the job and secured his father's safety.
He does this to ensure said father will be protected, something Mike swears to do personally. Nacho will fall on his sword even as he could have still tried to selfishly make his escape and abandon his father who would most certainly end up being killed as recompense for his betrayal.
Nacho betrayed Lalo by informing the police about his drug-dealing operation. Nacho had been working as Lalo's right-hand man for some time, but he decided to turn on him after Lalo killed Nacho's father. Nacho contacted the police and told them about Lalo's drug operation, which led to Lalo's arrest.
Since the second season, Mike has assisted Nacho Varga in getting out of his contract with the Salamancas. The original plan was for Nacho to claim to be working for a Peruvian Cartel in order to kidnap and kill Victor, and after he runs as fast as possible to get at him, he will be murdered.
Nacho is a good guy. He is a loving husband and father. He is a hard worker and takes care of his family. He is a good friend and is always there for you.
Nacho Goes to Prison
Nacho was arrested under suspicion of having something to do with the Kettlemans' disappearance, and he named Jimmy as his legal representation. (The police were all too happy to drag Jimmy to the station as if he were a criminal himself.)
The overriding intention behind Mike's Better Call Saul safe-swapping trick was to ensure Nacho's death without casting suspicion over Gus Fring.
After playing the double agent for Gus against the Salamancas and aiding in the botched assassination of Lalo Salamanca (Tony Dalton), Nacho was ready to meet a violent end at the hands of the Salamanca cartel, but instead he turned his gun on himself.
Why did Nacho Varga kill himself? Nacho killed himself to protect his father and so that he could go out in his own terms. While Nacho may have gotten himself mixed up with the Salamanca cartel and Gus Fring during his time on Better Call Saul, his father, Manuel, leads an honest life running an upholstery shop.
Rather than pretend to flee as planned so that Victor can kill him quickly, Nacho uses a piece of broken glass to free himself from his zip tie, seize Juan's gun, and kill himself. The Cousins then assist Hector to fire bullets into Nacho's lifeless body.
There is, however, a deeper reason Mike might've been cheering Nacho on... A few subtle clues dotted throughout Better Call Saul's "Rock & Hard Place" suggest Mike Ehrmantraut might've actually plotted to help Nacho escape.
He became one of Tuco Salamanca's most trusted enforcers and later became the lieutenant of both Hector and Lalo Salamanca. Against his will, Nacho later became an informant to Gustavo Fring after being blackmailed by him.
Although the Salamancas knew about Nacho's involvement until Better Call Saul season 6, Gustavo Fring knew the truth about his role in Hector's life-saving medication theft right away. As a result, Gus blackmailed Nacho into serving as a double agent by making fun of him.
Juan Bolsa, a major lieutenant of the Cartel, hired them to steal Lalo Salamanca's bail money, which amounted to seven million dollars.
Nacho died to protect his father, and he made good use of his final moments to make it clear to Hector precisely how he felt about him. He also took his own life so that they couldn't have the pleasure of doing so.
Lalo then realizes that Nacho is missing and angrily strides away from his house. Lalo kills one of his tenants to serve as a body double and leaves the man's body inside his home, causing police and the cartel to assume Lalo is dead.
Most of the movie is spent with Laura trying to decide between Massimo and Nacho. But The Next 365 Days leaves the ending ambiguous. Laura returns to Massimo and they share a moment on the beach.
Having taken on the role of inside man in Gus Fring's plan to assassinate Lalo Salamanca, Nacho was quickly fingered by everyone as being key to the plot. The cartel wanted him, the Salamancas, too, and Nacho was forced to hide in a puddle of oil to escape them.
Fring simply made the deduction that Nacho either poisoned him or tampered with his medication and he set him up and made him tell what he did.
The cartel wanted him, the Salamancas, too, and Nacho was forced to hide in a puddle of oil to escape them. But after contacting Gus and extracting a guarantee of safety for his father from Mike Ehrmantraut, Nacho was smuggled north of the border in the bottom of a truck and briefed on how to make his final confession.
You can read the full quote below: "There's a profound connection between Mike and Nacho that is sort of unspoken. In many ways, they are cut from the same cloth, and Nacho looks at Mike as a mirror of his own father in the cartel world. There's this unspoken virtue between them and an honor among thieves.
However, while waiting for Nacho's reply, Jimmy is picked up by the police, who tell him that they had arrested Nacho on suspicion of kidnapping the Kettlemans, and he had requested Jimmy as his legal counsel.
Tuco eventually traveled to Albuquerque, New Mexico and worked alongside his uncle at his drug distribution business. He employed No-Doze, his brother-in-law Gonzo and Nacho Varga as his closet associates and lieutenants, and also employed a number of street-level dealers, including Domingo "Krazy-8" Molina.
He shows up in Season Three after trying to vandalize K&D and Daphne confronts him. Later when Daphne is beginning to rebel against Regina, she and Nacho meet up again to vandalize the ground breaking ceremony set up by Wes and Regina. They end up kissing and it seemed they were in a relationship.