Why do chameleons change their skin color?

Not to blend into their background, never have, never will. They change their color depending on a number of emotional states, they change often, and so it’s no wonder that eventually they will match their backgrounds, but only until the next change. They change color when frightened, when mating, when fighting another chameleon etc.

A chameleon would have little use for blending in, their main prey, insects, tend to have eyesight unfit to spot them when they are still anyway, and being an apex predator, chameleons don’t tend to have any natural predators.