If your in a desert running around in a red cape it's like announcing to the world "I'm here shoot me" or you can perceive it as trying to be unique and stand out from the crowd. What's important to you tactical mind set or being one of a kind?
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Depends more on the stats on the gear. The color of gear can be changed by gear shaders. But yeah it could be a downside to have bright armor. Then again your enemies names appear over their heads after you see them. Bright armor is still a giveaway