NOTE: This suggestion is for JIRA Cloud. Using JIRA Server? See the corresponding suggestion.
I might be in the minority here, but case sensitivity on labels seems completely contradictory to the spirit of what labels are there for in the first place.
I see labels as acting as the primary identifier within the application, and taking the place of miscellaneous fields that don't need to be cluttering up your screens. Instead of an arbitrary field that may or may not even be used, the reporter on the issue navigates to the "Label" field and types what they need. Instead of perusing the page for their 2-10 fields, they simply enter the 2-10 keywords into the "Label" field.
In the vein of ease of use, having labels that can be identical (only differentiating in capitalization) not appear within the same search/filter only complicates things. On top of this, user's often think that they're adding the correct label, when in fact they are not inputting the label that will cause their issue to appear on the desired filter/board. This false sense of security then comes back to bite them later, and the user is (rightfully) very turned off from using the application for anything meaningful from that point forward. I've experienced that exact scenario (first hand, second, and third) at multiple companies leveraging JIRA.
JRACLOUD-24907 labels should be case insensitive
- is related to
JRASERVER-45407 "Label" Field Case Sensitivity Is Contradictory to Ease of Use for Users