Sigil and the doorway to nowhere
A Soul Stone is a Semi-Meta tool to make things interesting. Every PC, and most notable NPCs have one. It can be on a persons hand, chest, face, and sometimes elsewhere, so someone may have one even if it is not obvious.
When someone with a soul stone dies (and isn’t resurrected w/in the time limit), they will reincarnate shortly afterwards as a new character. Any equipment they had and used will fade with their corpse (even if removed). Treasure, potions, and non-gear and anything that isn’t used will not disappear. The new character will start w/ level appropriate gear and money (L-1, L, L+1 and money = an item of level). A newly reincarnated character starts with the same XP but then loses 20% of the current level’s worth*. If this would make them lose a level they don’t, but take -1 penalty to hit until they get enough XP to be the level they are.
Additionally the Soul Stone is a tool for entertaining the GM and making your characters more heroic. When you attack, if you describe the attempt in an entertaining and evocative way before you roll (EG not just saying “I shoot him with magic missile”) your soul stone will gain one Role Point (like XP, but for your soul stone). If you have described your attack and your natural roll is the level of your Soul Stone or lower (like a critical failure for example) you may use your Soul Stone to reroll the attack. This costs one level from the soul stone, plus a number of RP (1/2/4 for At-Will/Encounter/Daily attack powers).
During a short rest, a level 0 soul stone automagically returns to level 1. During an short rest you may spend RPs to raise the level of your Soul Stone by 1 level.
L2 costs 2 RPs, L3 costs 4RPs, L4 costs 7RPs, L5 costs 11RPs, L6 costs 16RPs… etc.
*A level 3 character needs 1500 XP to go to four, so would lose 300xp.