Denver Nuggets forward Peyton Watson is seriously considering signing the team’s $6.5 million qualifying offer, which would clear a path to unrestricted free agency in the summer of 2027, according to league sources.
The 24-year-old entered restricted free agency hoping to top the five-year, $125 million extension guard Christian Braun secured last fall. Denver’s initial proposals to Watson were reportedly in the range of $70 million over four years, well below his target.
Financial pressure intensified for the defending champions Sunday when they matched Oklahoma City’s two-year, nearly $12 million offer sheet for forward Spencer Jones. That decision vaulted the Nuggets above the second tax apron and nearly doubled their projected luxury-tax bill from $36 million to $68 million.
Even Watson’s one-year qualifying offer would deepen the hit. ESPN’s Bobby Marks estimates the tax penalty would approach $112 million if the winger accepts the tender as is.
Denver has explored sign-and-trade scenarios to recoup value should negotiations stall. The Bucks, Clippers and Hawks have shown interest, but current CBA rules bar the Nuggets from receiving players in a sign-and-trade while they remain above the second apron. They would need to shed salary first.
Beyond two-time MVP Nikola Jokić, Denver’s largest 2026-27 commitments belong to Jamal Murray ($50.1 million), Aaron Gordon ($32 million) and Cameron Johnson ($23 million). Despite offseason speculation, the front office has not indicated a willingness to move any of those veterans.
The franchise has yet to finish a season in the second apron since the provision was introduced in the current collective bargaining agreement. Remaining above that line in 2026-27 would freeze Denver’s 2034 first-round pick, preventing it from being traded.
Watson has until the qualifying-offer deadline to decide whether to lock in the one-year deal or continue seeking a longer contract elsewhere. For now, both player and club must weigh the escalating cost of every option.
Source: Hoops Rumors
