Many video games use the color sequence while - green - blue - purple - orange - red to indicate the rarity of items or achievements. Which game was the first to do so, popularizing this scale?

https://en.wikipedia.org/wiki/Loot_(video_games)

Based on the wikipedia article, it seems like the answer is World of Warcraft. That's at least the first game where that full scale was in use. There were a few forerunners to that though with Diablo 1 being the first to really start a tier system based on color, and Diablo 2 fleshing it out further. The game publishers were inspired to do so by an old ASCII game called Angband.