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If I loot an blue or purple armor piece do I have to have level 50 in crafting to upgrade it? (From blue to purple, purple to gold)
You don't have to be level 50 to upgrade it from blue to purple or purple to gold.
However, there are passives that allow you to reduce the number of materials needed for each upgrade.
From Purple to Gold WITH the passives it takes 8 pieces.
From Purple to Gold WITHOUT the passives it takes 16 pieces.
If you take a Woodworking object such as a stave with current EU PC prices of around 5-6k for each one, that's a saving of 40-50k by either leveling your craft or asking someone else to do it for you (actual prices may vary on your server and platform).