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Scoop.it!
Badges are new in Moodle 2.5+ . Badges are a great way to motivate users. They are an electronic way to demonstrate that you have mastered a specific skill. Moodle badges may be awarded based on a variety of criteria chosen by the teacher. You can upload your own images as badges or get them from a site such as Badges for Your Moodle.
Steve Whitmore's insight:
What would you badge together? Oakland Schools is exploring this in special education professional development 
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Digital badges have been around for several years, but still have a way to go until they are fully integrated and recognized appropriately in education and in the world of work. The fact that Moodle, a widely-used and free system for online instruction, has integrated them in their system is definitely a step in the RIGHT direction. Go Moodle!