Materia System Revisions (06/13/2013) on the Lodestone

Most importantly:

8-1. Conversion of Version 1.0 Materia
1. All Version 1.0 materia will be automatically converted into cracked materia.

2. Players will be able to exchange their cracked materia for new materia of their choosing.
* Materia that has already been affixed to gear can be converted as is.

Even after converting cracked materia, there is the possibility certain gear will see a decrease in effectiveness when compared to Version 1.0. To compensate for this loss, players will have the option to exchange any gear affixed with cracked materia for a special currency. The amount of currency received is based on the type of gear as well as the number of materia affixed. This currency can be exchanged for a variety of gear, such as those obtained in dungeons and primal battles, or darklight gear.

* The exchange of cracked materia and gear affixed with cracked materia will be possible starting from phase 4.

8-2. Restoring Cracked Materia

Suddenly glad I was a packrat that barely sold anything towards the end of 1.0. But sad to see some of the useful/some of my personally favored materia go, such as Healer's Hand & Sound of Serenity.