[Nexus 5 Android Development] KreAch3R:
Ok, so, here are my findings:

05-25 09:38:24.141 D/Tethering( 781): Tethering wlan0
05-25 09:38:24.142 D/Tethering( 781): InitialState.processMessage what=2
05-25 09:38:24.156 D/Tethering( 781): sendTetherStateChangedBroadcast 0, 0, 0
05-25 09:38:24.157 D/TetherController( 202): tetherInterface(wlan0)
05-25 09:38:24.197 D/Tethering( 781): Tethered wlan0
05-25 09:38:24.200 D/Tethering( 781): sendTetherStateChangedBroadcast 0, 1, 0
05-25 09:38:24.200 D/Tethering( 781): MasterInitialState.processMessage what=1
05-25 09:38:24.200 D/TetherController( 202): Setting IP forward enable = 1
05-25 09:38:24.203 D/TetherController( 202): Starting tethering services
05-25 09:38:24.204 D/TetherController( 202): Sending update msg to dnsmasq [update_ifaces:wlan0]
05-25 09:38:24.204 D/TetherController( 202): Tethering services running
05-25 09:38:24.204 D/Tethering( 781): startListeningForSimChanges
05-25 09:38:24.205 D/Tethering( 781): simchange mGenerationNumber=3, current generationNumber=3
05-25 09:38:24.205 D/Tethering( 781): got Sim changed to state LOADED, mSimAbsentSeen=false
05-25 09:38:24.206 W/clatd ( 1876): read_packet: unknown packet type = 0x86dd
05-25 09:38:24.206 D/Tethering( 781): chooseUpstreamType(true), preferredApn =4, got type=-1
05-25 09:38:24.208 D/ConnectivityManager( 781): sending expire msg with seqNum 0 and delay 60000
05-25 09:38:24.208 D/ConnectivityManager( 781): starting startUsingNetworkFeature for request NetworkRequest [ id=11, legacyType=4, [ Transports: CELLULAR Capabilities: DUN&TRUSTED&NOT_VPN] ]
05-25 09:38:24.208 D/Tethering( 781): [B]notifying tethered with iface =null[/B]
05-25 09:38:24.208 D/Tethering( 781): TetheredState.processMessage what=12

Vs

05-26 01:52:22.816 860 878 D Tethering: Tethered wlan0
05-26 01:52:22.817 860 878 D Tethering: sendTetherStateChangedBroadcast 0, 1, 0
05-26 01:52:22.818 860 878 D Tethering: MasterInitialState.processMessage what=1
05-26 01:52:22.823 236 858 D TetherController: Tethering services running
05-26 01:52:22.823 860 878 D Tethering: startListeningForSimChanges
05-26 01:52:22.829 860 860 D Tethering: simchange mGenerationNumber=1, current generationNumber=1
05-26 01:52:22.829 860 860 D Tethering: got Sim changed to state LOADED, mSimAbsentSeen=false
05-26 01:52:22.831 860 878 D Tethering: chooseUpstreamType(true), preferredApn =5, got type=0
05-26 01:52:22.831 860 878 I Tethering: Finding IPv4 upstream interface on: XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXx
05-26 01:52:22.831 860 878 I Tethering: Found interface rmnet0
05-26 01:52:22.832 860 878 D Tethering: [B]notifying tethered with iface =rmnet0[/B]
05-26 01:52:22.832 860 878 D Tethering: TetheredState.processMessage what=12

Also, I get this in my logcat:

05-26 01:52:22.831 860 878 I Tethering: Finding IPv4 upstream interface on: {InterfaceName: rmnet0 LinkAddresses: XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

This led me to think that your APN settings aren't exactly correct or you're in some kind of IPv6 only mobile network. A bit of googling revealed this, and, possibly, the same bug as you in other users.

Then, more googling for other possible solutions, or

quoting this

And you should also try this and this value in build.prop

persist.sys.dun.override=0
net.tethering.noprovisioning=true

Lastly, I would flash stock marshmallow, then cyanogenmod, and check if hotspot works there, and notice their APN settings. If I were you, that's where I would be looking. I'm sorry I can't provide a solution directly, but as I don't have the problem, you'll have to do your own troubleshooting.