We study agents on a network playing an iterated Prisoner's dilemma against their neighbors. The resulting spatially extended coevolutionary game exhibits stationary states which are Nash equilibria. After perturbation of these equilibria, avalanches of mutations reestablish a stationary state. Scale-free avalanche distributions are observed that are in accordance with calculations from the Nash equilibria and a confined branching process. The transition from subcritical to critical avalanche dynamics can be traced to a change in the degeneracy of the cooperative macrostate and is observed for many variants of this game.