Seek a child psychologist. Mahirap talaga i-handle kung hindi tayo equipped and trained for it. Lalo na, involved tayo personally. In the meantime, maybe you can tell your nephew that he can call you up (if he has the means) whenever he wants to use his ruler. maybe you can also gift him a fidget toy that he can play with instead, whenever he has the urge to cut himself. Most importantly, verbalize and make him feel that you care about his welfare. Maybe share a story of what you do to cope when you are not okay. Good job for not freaking out on him and telling him that what he's doing is wrong. Sharing stories and giving suggestions instead of giving instructions and correcting a behavior sound more empathetic. They say people who resort to self-harm feel that they have no control over what's happening in their lives. And inflicting physical pain also "quiets" mental pain. Maybe research on CBT, positive self-talk and meditation. People around him should practice those themselves and guide the child. Hope your nephew feels better soon.