Blue flashlights

What are the blue flashlights used for that I keep seeing in loot backpacks? Does the one we have gradually deteriorate? I’ve noticed after collecting they don’t appear in my inventory too so I’m just assuming

The flashlight doesn’t degrade, so if you’re picking up things that aren’t in your inventory, it’s either quest items or cosmetics. Put your cursor over it next time you see one and it should tell you what it is.

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