Purple partyhats come from opening a Christmas cracker that appeared in the 2001 Christmas holiday event. The partyhat is expensive because it's a Discontinued item, as no more are being created in the game (see Christmas cracker for details). The rarity of the item increases its demand, and the rarity itself renders them scarce, resulting in this massive increase in price. The purple partyhat was originally the most expensive of the partyhats, but became the cheapest after the Partyhat duplication glitch. Before free trade, the street price was much higher than the GE price, giving the false impression that partyhats sharply rose when free trade was reintroduced.
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15 Days of Christmas
During the 15 Days of Christmas in 2013, this item, along with other Christmas-themed equipment, were given the Hybrid style of combat, and stats that scaled with the player's levels. This was so players could use these items in combat to assist in hunting for festive crackers during the event.
In RuneScape Classic, partyhats were simply called "party hat" with no colour in their name. What is now the purple partyhat was more magenta in colour, but players called it pink. After the release of RuneScape 2, Jagex made a slight colour change to the "magenta" partyhat, and then named it purple partyhat.
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