Bungie has already said our characters transfer so i assume that's what they're doing
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Characters maybe ... what about our gear? Since above 20 your character IS your gear, this is a more important question. What about your vault? What about all the grinding that people have done? Ultimately, it is the loss of what was gained from that Grinding that will rub people the wrong way, more than anything else.
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don't see why they wouldn't transfer gear as well. also the gear will most likely become obsolete with the new weapons and gear so they'd be collection pieces only anyways