In the early days, exotics upgraded similar to legendary weapons, using ascension energy/shards or whatever it was called.

At some point, it was announced that exotics would be undergoing a change in the way they were upgraded. This announcement spurred a lot of people to liquidate their exotic items they weren't using, though I can't remember why. About a week later, it was then announced that exotics could be dismantled for exotic shards, which were now needed to upgrade exotic items. So, many people had completely screwed themselves out of a lot of rare upgrade material because the new system was only vaguely explained.

EDIT: this may have been right around the time Dark Below launched, because I dug through some old forum posts. I think the original exotic items from vanilla Destiny weren't going to be working the same way, so a lot of people broke them down, thinking they would just use the mats from them to upgrade the new one. Only a week later, it was revealed that all exotics would drop shards instead.

EDIT 2: I'm being downvoted for trying to remember something that actually happened? Now I remember why I quit playing Destiny: the community.