Creating a UTexture2D the following way does not properly process gradients in the texture:
Tested in 4.23.1 (CL - 9631420), 4.24 P2 (CL - 10091930), 4.25 (CL - 10236406)
1. Download the attached project
Expected: In the top left corner of the viewport, a texture with a gradient going from black to grey should appear
Result: There is a hard cutoff between the two colors on the texture
There's no existing public thread on this issue, so head over to Questions & Answers just mention UE-84648 in the post.