The colors in Illustrator are faded in every document regardless of RGB or CMYK mode. I have updated to Mac os Big Sur 11.2.3 And Illustrator 25.2.3 and restarted the program and device. I do not use Adobe Bridge and I tried to revert Photoshop to previous versions (22.2) and restarting Illustrator after reading this advice on another thread. This did not solve the issue for me.
On the left is the image placed into an illustrator. On the right is the exact image opened in image preview.
Again this is happening in every document. Has been going on for several weeks.