The factions currently have no purpose, and in the lore of destiny they are like parties for the tower(like democrats and republicans), I think in a later update they should have their own Social space like a building in the city or a ship. and adding to my last idea of matchmaking for more items, you could make the social space have different "Drop ships" to different raids/ weekly or nightfall, and once an acceptable amount of people get in it, a count down starts, then the ship takes off and you have a fire team of fellow faction members to do the activity with you. And for the PVP'ers there could be faction wars. To get onto a team you have to be wearing a faction band. And to enter the Faction social space, you also have to be wearing the bands
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