We already know with the House of Wolves expansion, progressing your character in Destiny will become more simplified. However, it appears that during the livestream detailing the changes coming to the game's progression economy, Bungie forgot to mention that Commendations are being phased out with update 1.2.0.
"Commendations are one more element to the upgrade path for your Guardian that we’re changing. Essentially, they’re going away. You'll no longer need them to acquire new weapons or gear," Bungie said in this week's blog post.
Currently, Commendations are earned by ranking up your reputation levels with the game's various factions, and can be exchanged for vendor weapons and gear. Of course, if you're one of the players that complete Bounties every day, you have probably saved up quite a bit — more than you possibly need.
The good news is they won't go to total waste. Prior to the update, you are able to turn them in to gain reputation for a specific faction. A GIF included in Bungie's weekly update shows that a Commendation can be exchanged for 250 Reputation points.