In the development of
Buddhism from the early schools such as the
Theravada, Mahasanghika, and so on the nagas were one strategy used to explain the gaps in historical availability of what was purported by the later schools of Sakyamuni
Buddha's Teachings.
The Prajnaparamita Teachings were said to have been too advanced for the human sravakas or "hearers" of the time of the Buddha. But they were also heard by the nagas who cherished them, recorded them, and stored them in their underwater palaces.
A few centuries after the Buddha's death they looked to a young Buddhist scholar and monk to convey this Dharma back into the world of humans. This young monk became known as "Nagarjuna" (2nd to 3rd century A.D.), who began a movement to deconstruct the categories of Abhidharma and expose them to nakedness of the experience which they attempted to describe.