Love the concept of this. Steemit board do something similar. It kinda works.
I think badges are a good idea. But they need to be visible beside your name. Maybe only one badge at a time could be chosen from your list of available badges.

This could also be monetised if required by the inclusion of custom skins for specific things. I.e. You've earned the badge but you want a custom skin for it and can be bought via a microtransaction.

Great post.
Steem on👍