Denver's current offer leaves room for another round of talks, and the most likely finish is a richer deal that keeps Peyton Watson.
Peyton Watson's free agency has reached the point where both sides know the basketball fit, yet the contract still hasn't matched his value to Denver.
Denver's reported offer covers four years and $70 million with a team option, a structure that gives the team the final choice on the last season.
Watson can accept his qualifying offer and reach unrestricted free agency next summer, so Denver can't treat restricted status as a complete answer.
My prediction is that the Nuggets add guaranteed money, remove the team option and find a deal that keeps him in the starting group.
Denver Has More to Lose
Watson averaged 14.6 points and 4.9 rebounds in 54 games, while his shooting improved enough to make defenders respect him away from the rim.
His best value still comes on defense, where he can guard quick wings, switch onto larger players and cover ground behind Nikola Jokic.
Denver's own leaders said retaining Watson was an offseason priority before negotiations slowed down.
That view should become more important as the season gets closer because replacing his defense with a cheaper player would put more work on Christian Braun and Aaron Gordon.
The Nuggets also saw how the lineup changed when Watson was unavailable.
He missed the playoffs with a hamstring injury, and Minnesota found easier ways to attack the perimeter during the first-round series.
That absence also cut into Denver's lineup choices.
Coach David Adelman couldn't move Watson between scoring wings and smaller guards, which left Braun with less freedom and made Gordon cover more ground away from the basket.
Watson Has a Real Choice
The qualifying offer gives Watson a path to bet on himself, play one more season and choose his next team without restricted free agency hanging over the process.
That route carries injury risk, but it also makes sense for a 23-year-old who just made a large jump and believes another season could raise his price.
Denver knows Watson's market has already been discussed around a much higher annual salary.
A team option on the current proposal asks him to take less money while giving the Nuggets the final choice, which is a hard sell after his strongest season.
His 41.1 percent shooting from three may cool off, though Christian Braun also needs help with the hardest perimeter work.
Watson's defense gives Denver another answer when the shot doesn't fall.
A Better Deal is the Cleanest Finish
Denver can close the gap by moving more money into the guaranteed years and letting Watson control the last season.
A three-year contract with a player option would give him another chance at free agency while keeping the Nuggets from losing an important starter next summer.
The team has already watched Watson take on larger scoring nights when starters were missing, and that upside is hard to replace late in the offseason.
I expect a compromise because Denver needs his defense now, while Watson can still earn another major contract before his prime ends.
The gap is mostly about who controls the next decision, and Denver can settle it by giving Watson enough freedom to benefit from another strong season.
