Another state is now joining the Arizona and Maryland. Colorado residents now could use Wallet app to keep their driver license or state ID in digital form. There is a catch though.
The Department of Revenue says that the Wallet ID is designed to be a companion to the physical driver's license or ID, and it is not a replacement. Coloradans must continue to carry their physical driver license or ID with them, and the Wallet ID can only be used at airports.MacRumors
Interestingly, Apple's home state of California is not even on the list of states which are working on making ID available in Wallet.
Reference: iPhone Users in Colorado Can Now Add IDs to Wallet App