Can't upvote this enough. One dev mentioned in a GitHub issue that the blue color is for branding reasons [1]. This is so absurd, it hurts. That status bar is the most distracting and annoying thing ever.

See link for suggestions how to mitigate. I use the tip from the person named sysrpl. VSCode is unusable with that blue color for me.

1: https://github.com/Microsoft/vscode/issues/1884