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Xbox Live will phase out Microsoft Points rewards next month

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As part of its plan to transition from Microsoft Points to real currency, Microsoft will phase out Points-based Xbox Live Rewards beginning Aug. 1, according to an email sent to Polygon this morning.

Currently, the Xbox Live Rewards loyalty program gives members Microsoft Points and other digital goods for completing tasks on Xbox Live, including making purchases through the Marketplace, renewing Gold subscriptions, playing games and using other features. As Microsoft phases out Microsoft Points, they will no longer be offered as rewards, but the company states it has plans to replace them with something "even better."

"Since this currency change is impacting the structure of the program, we're taking the opportunity to make Xbox Live Rewards even better," reads the statement from Microsoft. "You'll continue to get rewarded for doing the things you love on Xbox Live — just not with Microsoft Points."

According to the email, the Xbox Live Rewards website will be updated on Sept. 1 with information on the new rewards system.

Any pending Microsoft Points rewards will be added to players' account balance on Aug. 7, and all remaining Points in players' accounts once the full transition to real money occurs will also be converted into their country's currency. A full FAQ on the transition is available on the Xbox support website.