The game is not elimination. It is balance.

Every real system has both regeneration and extraction running simultaneously. Value is being created and captured. The question is never "does extraction exist?" It is always "which side is winning right now, and how would you tell?"

Think like an investor. You don't need to be right on every trade. You need your wins to outweigh your losses. If you're right 55 percent of the time, returns compound. If you're right 45 percent of the time, you go broke. The math is unforgiving.

Systems behave the same way. When regeneration outweighs extraction most of the time, the system grows and strengthens. When extraction outweighs regeneration, it decays or gets captured. When they're nearly balanced, the system is in tension, and the outcome depends on what happens next.

The skill Prevolutionary Architecture demands is the ability to see both forces simultaneously and read where the balance sits in a specific protocol, community, or city. To make that concrete, look at four systems: Gitcoin, Lido, Uniswap, and Octant.

Gitcoin's core question was simple: how do you fund public goods when wealthy actors can always outspend everyone else? The answer was quadratic funding. Instead of allocating matching funds based on raw capital, the mechanism uses the square root of contributions. Ten people giving 1 unit each count more than one person giving 10. The matching formula amplifies broad support and dampens the influence of single whales. It's a direct attack on strategic position asymmetry in public goods funding.

Over time, Gitcoin has distributed tens of millions of dollars to open-source projects, climate initiatives, community tools, and more. The mechanism is transparent enough that builders can learn how it works and predictable enough that communities can plan around it.

Regeneration is clearly present. New infrastructure and tools exist that wouldn't have been funded in purely private markets. The distribution of funds is clearly tied to community preferences rather than to individual donors. The Gitcoin ecosystem has persisted through multiple market cycles.

Extraction attempts exist, too. Some actors try to game the voting process with sybil attacks or coordinated campaigns. Some projects overstate impact. Some whales still try to steer matching funds through large, strategic contributions. But structurally, the design makes extraction more expensive than regeneration. Gaming the system takes coordination and risk. Building genuinely valued public goods is often the easier path. That's what "regen greater than extract" looks like in practice.

Moreover, notice the regenerative feedback pattern: the more transparent and well-explained the mechanism is, the more people can participate effectively, which generates more trust, which enables more genuine participation. Defending the system (through education and sensemaking) strengthens it rather than depletes resources. Each exercise of transparency creates capacity for the next one.

You can spot structural regeneration when:

• The mechanism itself mathematically biases toward many small voices over a few large ones (Gitcoin's quadratic funding does this)

• Governance tokens are broadly distributed, reducing the chance of capture

• Ongoing investment in explaining how the system works is actively maintained

• Protective mechanisms (education, transparency, dispute resolution) strengthen the system when exercised rather than deplete it

That system is actively resisting 'devolution'.

Lido began as a solution to a genuine problem. Most people couldn't or wouldn't run their own Ethereum validator, but they wanted staking yield and network security. Liquid staking pooled ETH, allowing users to deposit smaller amounts and receive a liquid token in return. That's a real regenerative service. It increases network security and broadens access to yield. But the way the system is structured has gradually shifted the balance toward extraction.

Today, Lido accounts for around 30 percent of all staked ETH. It's the single largest staking entity on Ethereum. Combined with major exchanges, a handful of actors control a majority of staked ETH. That's concentration at the protocol's consensus layer. This doesn't mean Lido is malicious. It does mean governance decisions affecting a critical share of Ethereum stake can be influenced by a small group. Fee structures and policy changes can be made that benefit Lido more than the broader ecosystem. The risk of correlated failure or censorship is non-trivial.

Regeneration is still clearly happening. Users earn yield they otherwise might miss. Ethereum remains secure and perhaps more decentralized than if only large exchanges offered staking. But the extraction side is winning in key dimensions. Market share has been high enough to trigger serious public debate about appropriate limits. Lido governance power is tied to the LDO token, held in significant quantities by insiders and early investors. Protocol changes can be influenced by actors whose incentives are not fully aligned with the broader network.

Notice too the degenerative feedback pattern: the more concentrated stake becomes, the more actors worry about capture, which creates regulatory and cultural pressure that increases defensive spending, which doesn't reduce the underlying concentration but does deplete ecosystem resources. Protective measures (governance tokens, oversight) don't strengthen the system—they add complexity while concentration persists. The system gets harder to defend, not more defensible.

The signs of extraction winning:

• One protocol controlling 30 percent of stake over multiple years (strategic position asymmetry at the infrastructure level)

• Public concern from core community members and researchers about that level of concentration

• No hard, constitutional mechanisms in Ethereum itself to limit any single protocol's share

• Fee changes that can be made with concentrated token control (enforcement asymmetry)

You can have a system that provides real regenerative services and yet structurally favors extraction because the architecture makes concentration easy and diversification hard. "Regen exists" is not the same as "regen is winning." This system is vulnerable to 'devolution'.

Uniswap is an example of a system in genuine tension. It has strong regenerative dynamics, real extraction risks, and an ongoing governance battle that hasn't yet resolved.

From a regeneration perspective, Uniswap is straightforward. Anyone can provide liquidity and earn fees. Anyone can swap without permission. The protocol has become foundational DeFi infrastructure across chains. The introduction of the UNI token was meant to align governance with users and liquidity providers. Sixty percent of the genesis supply was allocated to the community, with 21.5 percent to the team and 17.8 percent to investors, subject to lockups. On paper, that looks broadly distributed.

In practice, several dynamics create tension. A large share of UNI remains in treasury and team/investor allocations, leading to significant concentration in non-circulating hands. On-chain analysis shows that a relatively small number of addresses hold a large portion of active UNI, influencing governance votes. Proposals for fee switches, revenue sharing, and protocol upgrades often highlight divisions among stakeholder groups.

Regeneration is obviously still winning in aggregate. Uniswap processes huge trading volumes and generates fees for LPs across many markets. But extraction is also possible: large holders can steer governance outcomes in their favor, and protocol-level fees can be directed to concentrate value.

The signs of genuine tension: governance participation is non-trivial, with proposals debated rather than rubber-stamped. Token concentration exists but isn't yet absolute. No single actor fully controls outcomes. The community has successfully resisted some proposals seen as too extractive.

Regenerative potential: When governance is contested but transparent, when proposals are debated openly, communities build collective sensemaking. Each debate teaches more participants about protocol mechanics. Each resistance to capture reinforces norms against extraction. The system strengthens through the exercise of defense—participatory governance as a protective mechanism that, when working, builds the capacity needed to resist extraction.

Most systems are not cleanly "regen" or "extract." They are contested. The job is to understand the contest clearly and determine whether the trajectory is toward greater concentration and extraction or toward countervailing structures that protect regeneration. The outcome here will decide whether this system devolves or evolves.

Octant takes a different approach. Instead of starting with a product and then bolting on governance and funding, it begins by redesigning capital formation so that the core economic engine is regenerative.

The Dragon Vault pattern is simple in concept. Capital, for example, ETH, is staked or otherwise deployed into yield-generating strategies. The yield, not the principal, becomes the primary funding stream for operations and public goods. Participants govern allocations from that yield and can be split across sustainability pools, matching pools, and direct rewards to contributors.

This solves a central problem: there's no debt to service and no external equity demanding an exit. There's no structural pressure to extract faster than the underlying capital can regenerate. In Octant v2 designs shared publicly, a core "Sustainability Pool" accumulates yield to act like a sovereign wealth fund for public goods. Portions of yield go to matching funds (public goods rounds), to regen rewards (rewarding community members), and to operational costs. Allocation decisions are made by "Dragons" (capital providers) and the broader community through structured processes.

Regeneration is literally baked into the capital model. The principal can, in principle, remain intact indefinitely while the yield continues to fund work. Operational spending is tied to a regenerative stream rather than one-off raises or debt. The system can support long-term public goods without constantly chasing new capital.

Regenerative feedback at the capital level: the more sustainable the system becomes (lower extraction pressure), the more stable allocations are, which allows better community planning, which creates better public goods outcomes, which attracts more capital to stake, which increases yield available for allocation. Each cycle makes the system more resilient, not more extractive.

Extraction is still possible in theory. Governance could be captured. Yields could be redirected disproportionately to insiders. Future changes could compromise the model. But structurally, it's much harder. There's no investor equity structure demanding a liquidity event. There's no leverage that forces yield to be skimmed to pay creditors. Yield allocation rules are visible and can be designed to require broad agreement. Protective mechanisms (transparency, multi-stakeholder governance, yield caps) strengthen the system when activated because they increase trust and participation.

You can spot this working through:

• On-chain funding flows tied to a clearly defined vault model

• The central economic pressure is "how do we allocate shared yield," not "how do we keep paying debt or investors"

• Governance is explicitly framed around public goods and community reward, not just profit maximization

• Protective mechanisms that regenerate: transparency about yields increases confidence, broader participation increases capital, better capital means more yield to distribute

If you redesign capital so that it regenerates instead of depletes, you tilt the entire system toward abundance before you write a single line of governance code. You make 'devolution' structurally much harder to trigger.

Putting these four together, you can start to see a pattern of signals that tell you whether regeneration or extraction is currently winning in a system.

Regeneration is structurally favored when:

• Mechanisms mathematically amplify many small contributors over a few large ones (Gitcoin's quadratic funding)

• Capital models preserve principal and yield funds work (Octant's Dragon Vaults)

• A broad, enforced distribution of tokens or power limits any actor's ability to dominate

• Ongoing investment in explaining how the system works is actively maintained

• Protective measures strengthen the system when exercised (transparency creates trust, accountability deepens relationships, governance builds collective intelligence)

Extraction is structurally favored when:

• You see high, persistent concentration in a critical function (Lido's 30% of staked ETH)

• Rule changes are justified by "speed" or "efficiency" that centralize authority

• Revenue or fee mechanisms can be changed unilaterally by concentrated token holders

• Governance is opaque or performative, where outcomes are predictable regardless of community input

• Protective measures deplete resources when exercised (surveillance adds cost, compliance overhead reduces participation, centralized control requires escalating force)

Genuine tension looks different:

• Active, contested governance with real stakes (like Uniswap)

• Visible concentration, but also visible resistance and mitigations

• Communities that understand the risks and argue about them in public

The point is not to label systems as good or bad. The point is to develop the habit of asking, in any system you touch: Where is regeneration happening? Where is extraction happening? Which side is winning today? What does the architecture suggest about tomorrow? Is this system evolving, or is it vulnerable to 'devolution'?

Are the protective mechanisms used to defend the system making it stronger or just more defended? This is the diagnostic test. Prevolutionary systems have protective measures that strengthen the system when activated. Devolutionary systems have defenses that only hold back erosion.

The final article in this series answers a sharper question: if you want regeneration to consistently beat extraction without relying on heroics or constant vigilance, what would you actually build into your system from day one? How do you design a Prevolutionary Architecture?