This isn't exactly the update Denver Nuggets fans wanted to hear about Peyton Watson, but it seems to be par for the course as the Nuggets navigate their way down the free agency road. The Nuggets have been indicating that they're going to match offers for restricted free-agent Watson to retain him in Denver. But Sam Amick of The Athletic had a late-night drop putting a wrench into those plans, as the Nuggets are "open to a sign and trade."
"Yet as the Nuggets and Watson’s agent, Rich Paul of the Klutch Sports Group, have continued to be apart in negotiations for a new contract, sources say Denver is also very open to the prospect of a sign-and-trade for the 23-year-old forward," Amick said.
So, this isn't the best of developments for roster talent next season, and it would almost certainly take the Nuggets' chances of landing LeBron James in free agency down to next to nothing. The Nuggets wouldn't be better in 2026-27, and it could be a painful season in the Mile High City again, after the Nuggets were embarrassed by the Minnesota Timberwolves in the first round of the playoffs.
Watson puts the Nuggets in a conundrum
The Nuggets are truly stuck in a conundrum of what to do with Watson. They need youth and defense, and Watson provides both. But Watson wants Christian Braun's kind of money, who signed an extension with the Nuggets last year for five years, $125 million, that will kick in this coming season.
Braun, for his part, deserved an extension after his third season, in which he started 77 games and averaged 15.4 points and 5.2 rebounds, shooting 39.7% from three and 58% from the floor. He regressed substantially in 2025-26, but he was often injured and only played in 44 games.
Watson is more or less trying to gain the huge extension on the back of one hot month last January, when Nikola Jokic was out of the lineup. He has improved steadily over four years with the Nuggets, but the amount of money he wants is largely driven by hype and upside.
The Nuggets have to be thinking in the back of their minds that they could end up overpaying for two players for many years if, for some reason, Watson didn't pan out. And if he didn't, the Nuggets wouldn't have much flexibility to trade him away without having any tradeable first-round picks. They would at least, most likely, gain first-round picks in a Watson sign-and-trade.
You can see both sides of the coin for the Nuggets. It's a huge risk with a huge reward, or a huge flop. But the Nuggets can probably kiss their pipe-dream of LeBron goodbye if this sign-and-trade did happen.
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