From purely a business standpoint, why withhold skins?

The simple answer could be visual progression / long term thinking.

By selling epic and legendary (looking) skins early on in the game’s life, you’re prioritizing short-term gratification over long-term fulfillment.

Visual progression is a huge aspect of RPGs, especially MMORPGs, and by allowing the player base to open their wallets day 1 and run around looking like veterans who’ve cleared the game’s hardest rifts and dungeons… you’re more or less ruining the opportunity for characters to experience visual progression.

This can hurt the game in the long-term.

This is not a perfect argument, btw. There are problems, fair points to be made against this, and caveats and I could be wrong… but I have a feeling this is (at least part of) their reasoning and I personally don’t mind it. I actually think they should put more skins up on the marketplace, but make it so you can only see/purchase them once you hit a certain item level.