The idea is a great one and the technology certainly exists to pull it off. Mozilla has a strong "Open Badges" platform, and the with the increase in web-based tools, it would be very simply to organizations to use free sources to start badge-programs everywhere. The problem is...will this ultimately validate students, or will the flood of badges drown out real progress?
For example, it's possible to get an "A" in a class and everyone will generally accept that as a positive step. The same is true for scoring a 2000 on the SATs or a getting a 4 on an AP test. Badges, however, are different. Some are skill based, some are competency based, and others are disposition based. It's actually possible to get a badge just for feeling a certain way about a subject. While these badges allow for educators to honor different types of work...will this ultimately lead to badge-inflation? Will soon everyone have tons of badges, making them virtually meaningless?
Personally, I've already started tinkering with this in my class and I ran into the same issue last year. In the first draft of the game, I had a strict set of required badges...which made them meaningless as everyone had the same amount. Later, I started adding badges on a whim. Whenever a student did something well, I made a badge to match their needs. This ultimately led to badges being practically worthless as there were so many, none were special. This year, I found a middle path. I only have 12 badges available, and only 2 are required. The rest are reserved for those who really want to grow beyond just having an "A". So far, it's been a solid system. In this coming "badge" world, we'll need similar rules to prevent badge-flation from wrecking the badgeconomy.