Microsoft confirmed that the plan going forward is to phase out Microsoft Points and move to a real currency model. While Microsoft will start this transition this fall, those that have Microsoft Points should not feel rushed to spend them or use them, as Microsoft will credit existing points to your account with the equivalent real currency amount that is equal to or greater than the amount of Microsoft Points that you have.

In the short term, once the transition takes place users will still be able to redeem Microsoft Points cards; but these cards will be converted into real currency, which would then be deposited into your account. Microsoft Points are going away, but the good news is that Microsoft seems to have a good transition plan in place to take care of this.

Microsoft says that you should not fear redeeming those existing Microsoft Points cards that you might have hanging around, as you will not lose any value on these. Microsoft Points cards will be valid through 2014 and a short time after that. Once converted to currency, users will not be able to transfer the funds from Microsoft to a bank account or credit card.