What improvements might Blizzard make to the badge/emblem system?

Edit: Blizzard recently announced exactly what changes they will be making to the badge system, so we no longer need to wonder what they will do. Though I didn't anticipate them changing it to a point-based system, they will be implementing a system where there are two types of gear currency, and when a new tier of gear is released, the better type is converted to the lesser type. All I can say is, called it!

The addition of the Emblematic feat of strength in the last patch, sent people into a flurry of speculation about the fate of the emblem system in Cataclysm, but there's one thing we know: it's not likely that Blizzard will simply do away with the emblem system. Instead, they are probably going to change it; after all, we know they didn't like certain aspects of the Badge of Justice system, and we know they don't like certain aspects of the emblem system, so the question is, how can they change gear currency in the next expansion to address the issues that badges and emblems had?

One of the things Blizzard didn't like about the Badge of Justice system was that people could stock-pile badges and buy gear the day it was released. This was not their intention, so they put in emblems with the tiered system we know today. That way, people couldn't run heroics before a patch to stock up on emblems and buy gear the next day; they would have to run heroics after the patch, which was much closer to Blizzard's intentions. Problem is, with five tiers of emblems, things get confusing. Needing to trade down your emblems three or four times to buy heirloom gear is tedious, and it can be annoying to need to talk to multiple vendors just to see what gear you can buy with your emblems. Whatever changes Blizzards makes to the emblems system will need to address these issues.

I have seen suggestions before as to ways to improve the emblem system, but many of these have issues of their own. Some have suggested automatically upgrading emblems to the next tier when a patch hits, but this creates the same issue that Badges of Justice had in that you can stockpile emblems for the next patch. Some have also suggested making old gear be exchanged for the new emblems when a patch drops, but this would prevent your from using the emblems you had stockpiled to buy it. One simple solution is to allow higher-tier emblems to automatically downgrade when you buy something, but this would create issues of its own. People would probably accidentally spend emblems they didn't mean to spend, and imagine the horror of trying to refund them automatically.

Whatever new system is put in place, it would need to motivate people to run heroics all the way through Cataclysm's duration (like Wrath's system), rather than encouraging people to run heroics in bulk to save up emblems to buy gear immediately after the patch drops. One option is to use a system similar to Badges of Justice, but to inflate the cost of gear much more dramatically as the expansion goes on while also increasing the amount of emblems that drop from bosses. This would discourage people from running heroics in advance while still keeping things simple, but the cost of gear would probably reach absurd levels, and people would still farm heroics to get gear the minute it is released. It would also mean emblem achievements be worth less as the expansion wears on.

Perhaps emblems could be demoted as patches went on and be given better gear they can buy. Let me explain what I mean. Suppose that emblems are replaced with a currency we'll call seals. When Cataclysm launches, there would be two kinds of seals: Gleaming Seals of Justice, and Seals of Justice. Heroics (and ten-mans, if Blizzard wants 25-man raids to drop better gear currency) would drop Seals of Justice, while 25-mans and your first daily heroic would drop Gleaming Seals of Justice. GSoJs would be used to buy gear equivalent to 25-man drops, while SoJs would be used to buy gear equivalent to 10-man drops. Now, when a new patch with a new round of gear is released, all of your GSoJs would be demoted to regular SoJs (the idea being that time has made them lose their sheen), but all of the gear that had previously been bought with GSoJs will instead be bought with regular SoJs. Only the latest round of gear would be bought with GSoJs. And, of course, GSoJs could be traded down for regular SoJs.

This kind of system is not without its flaws. One could easily chain-run heroics early in the expansion to save up regular SoJs, then use those SoJs to buy the second best gear later in the expansion. However, the best gear would still only be available to those who continue to run heroics, and someone who is the kind of person to run heroics to save up seals for new gear is probably the kind of person who would want the best gear and would keep running heroics to get it. Players may also feel indignant about their "good" seals being transformed into "bad" seals, even though the "bad" seals would be capable of everything the "good" seals had been capable of before the patch was released. Players may also feel that it isn't worth it to spend their regular seals now when they can get better gear with them later, but if today's system didn't evoke feelings of, "Why run heroics now when running them later will give me better badges?" then I doubt seals will evoke a similar feeling.

Sadly, I cannot come up with some magic system that can solve all of the issues emblems have (if I could, I'd be writing up my resumé to submit to Blizzard, not writing up this blog post.). Considering that the Cataclysm press beta-invites have already gone out, perhaps we'll soon have some idea of just what Cataclysm has in store for us and our emblems. I am quite eager to see what Blizzard decides to do.