You're basically getting compensated for doing good deeds to the community. When you level up, you can unlock a variety of items such as avatars, entries to regular sweepstakes, or even Xbox Live games. Hopefully it won't be very hard to level up, and similar to gamerscore. Hopefully, they'll add a reward where you can get the new currency as a compensation for doing good deeds as well.
Via Polygon
"Leveling up in our program today might mean that you're a stellar Ambassador or a solid member Enforcement United beta program, or that you're a contributor to both," said Bobby Lamirande, program owner for Xbox Community Ambassadors. "In the future, leveling up might mean providing feedback that helps us improve our services, [providing] expertise in Xbox products or even creating game guides and helpful content in the Xbox.com forums."
Via Polygon