MWE:

\definelabel[xx][headcolor=red]
\starttext
ab\xx
\stoptext

fails, reporting in log:

tex error       > tex error on line 4 in file G:/Desktop/mwe.tex: ! Undefined control sequence

<argument> \c!symbolcolor
               
\labelparameter #1->\csname \ifcsname \??labels \currentlabel :#1
                                                                 \endcsname \??labels \currentlabel :#1\else \expandafter \dolabelparentparameter \csname \??labels \currentlabel :\s!parent \endcsname {#1}\fi \endcsname
\useconstructionstyleandcolor ...pty \else \dousecurrentstyleparameter \fi \edef \currentcolorparameter {\labelparameter {#2}

MkIV only, no problem in LMTX.

--
Rik