With the Colorado state capitol building visible in the background, partygoers dance and smoke pot on the first of two days at the annual 4/20 marijuana festival in Denver, Saturday April 19, 2014. The annual event is the first 420 marijuana celebration since retail marijuana stores began selling in January 2014. (AP Photo/Brennan Linsley)

By Daniel Wallis

DENVER, July 3 (Reuters) - At the Native Roots Apothecary, a discreet marijuana shop in a grand old building in Denver's busy 16th street shopping mall, business is so brisk that customers are given a number before taking a seat to wait their turn.

There are young men in ball caps, nervous-looking professionals in suits, and the frail and elderly. Staff say customers have been flocking to their outlets since Colorado voted to allow recreational pot use for adults from January.

Six months on, Colorado's marijuana shops are mushrooming, with support from local consumers, weed tourists and federal government taking a wait-and-see attitude.

Tax dollars are pouring in, crime is down in Denver, and few of the early concerns about social breakdown have materialized - at least so far.

"The sky hasn't fallen, but we're a long way from knowing the unintended consequences," said Andrew Freeman, director of marijuana coordination for Colorado. "This is a huge social and economic question."

Denver, dubbed the "Mile High" city, now has about 340 recreational and medicinal pot shops. They tout the relaxing, powerful or introspective attributes of the crystal-encased buds with names like Jilly Bean, Sour Diesel and Silverback Kush.

In the first four months, marijuana sales amounted to more than $202 million, about a third of them recreational. Taxes from recreational sales were almost $11 million.

Despite some critics' fears of a pot-driven crime explosion, Denver police say burglaries and robberies were down by between 4 and 5 percent in the first four months of the year.

THE DOWN SIDE

On the down side, sheriff's deputies in neighboring Nebraska say pot seizures near the Colorado border have shot up 400 percent in three years, while Wyoming and New Mexico report no significant increases.

In May, controls on marijuana edibles were tightened after two people died. In one case, a college student jumped from a hotel balcony after eating six times the suggested maximum amount of pot-laced cookies. In the other, a Denver man was charged with shooting dead his wife after apparently getting high from eating marijuana-infused candy.

As Colorado passes the six-month mark, Washington state is approaching with some trepidation the launch next week of the nation's second recreational pot market.

Up to 20 retail marijuana stores are due to receive licenses on July 7, fueling concerns about long lines, high prices, and the possibility of inadequate supplies when doors open the following day. Washington state officials have received some 2,600 applications from would-be weed growers, but say they have approved fewer than 80.

A recreational pot initiative will be on the ballot in Alaska this fall, and legalization bills look likely to pass in Oregon and the District of Columbia.

Although the Colorado law sanctioned pot sales only to those over the age of 21, one of the biggest concerns is the effect on teens.

Gina Carbone helped to found Smart Colorado, a non-profit aimed at informing young people.

She said the state's commercialization of pot put the business interests of the marijuana industry at the forefront, and that youngsters' perception of harm from the drug had been dramatically reduced.

Even before recreational retail sales began, Carbone said, rates of marijuana use among eighth-graders were significantly higher in Colorado than in other states.

"They are receiving messaging that this is medicine, that this is healthy," she said. "A lot of people that even voted for (legalization) are saying, 'Gosh, I didn't know it was going to look like this.'"

Visitors at Denver weed stores have their ID checked, often more than once. Some 20 recent sting operations have failed to catch any shops selling to under-21s.

Store workers at Native Roots, among the most well-established outlets, say they've seen a diverse range of recreational buyers, from heavy-lidded students, to curious middle-class couples, and seniors.

Native Roots sells cannabis in child-proof plastic containers priced at about $60 for 1/8th of an ounce, as well as pot-infused cookies and candy and marijuana e-cigarettes.

"This will help your pain," long-haired salesman Rob Folse told an older woman with a cane and a few tattered bank notes. "We're giving you a discount, Dear, because we understand your situation." (Editing by Jill Serjeant and Gunna Dickson)