Rather like makeup, it's a kind of falsification.
And why is it used? A large number of folks who dye their hair do it to not look their age.
Folks who are older, have grey hairs, are due more respect than folks who are younger. The older the more deference and care the younger are required to take in conversation and generally with.
I.e. turn the mockery secular society makes of the aged, with their disabilities, and instead think of the Christian grandfather or grandmother, and the authority and respect due in the family.
But if you cover that up, and youth is what is respected most, why is the youth valued? Not for good reasons I am thinking.
'The joy of young men is their strength: and the dignity of old men, their grey hairs.'
Proverbs 20:29