After installing the latest Ai version, I've had this issue where whenever I bring in a photo straight from Photoshop (Select -> Copy -> Paste in Illustrator) the colors become very dull/washed out. Almost like changing from RGB to CMYK. But it's not set to CMYK neither in Illustrator or Photoshop. When I bring in the original image from file explorer, there's no such issue, only when copy-pasting or importing from Libraries. Had no such issue with previous Ai versions.
Looks like it has something to do with the image being embedded, tried to mess around with Color Settings, but nothing have yet worked.