It's my preferred configuration file format, it fixes all the problems I have with JSON (trailing commas, comments) without turning it into a mess full of gotchas like YAML.
A theory - they don’t want a third party code in a hot path (they do care about performance in vscode), they already have a very performant parser and they don’t want to add a complexity there.
It’s without a spec
https://github.com/microsoft/vscode/issues/100688
https://github.com/microsoft/node-jsonc-parser