The Comedians badge is one of the most iconic items in comic book history, It was an iconic symbol the smiley face covered in a splash of blood seemed to sum up the comic perfectly, with its take on the world and it’s politics, It is unknown if this is what the creators were going for but it seems to have grown into something fans can wonder over. It also seems to reflect The Comedians personality even better, his twisted out look on life, mixed with the blood and pain he deals out. It is stained with blood of the Comedian as he dies. Nite-Owl thinks it's bean juice from Rorschach eating his beans. Rorschach found it near the scene of the crime and from there the real story of the badge starts as it makes it's own appearance in films and comics worlds over.
The blood stained smiley is a motif throughout the whole of Watchmen, popping up at key points in the story. Most notably the smiley is shown at the beginning and end of Watchmen. At the end of Watchmen the assistant of the editor of the city newspaper spills sauce from his burger across the smiley face t-shirt he is wearing. Another smiley face can be seen on Mars after zooming out from Doctor Manhattan. This is an actual crater called the Galle Crater. The badge has some how become the icon for the comic series starting a life of its own.
The meaning of the smiley is unclear, some say "it is a symbol for the whole series" others say, "it is a recurrent geometric motif". No matter what meaning the blood splattered smiley face has, it will always go hand in hand with Watchmen.