Netherite should be nerfed so it's on par with diamond rather than being a complete upgrade. This would allow players to mix and match armor types to suit different playstyles.
There's several ways of going about this but my personal favorite is this:
Keep Netherite the most protective/efficient/damaging tool/armor, make the armor slow the player down (not by enough to be a hindrance, but enough to be noticeable when compared to diamond), and make tools have a slightly shorter reach distance.
This would make it so Netherite and Diamond have uses in unique situations
For example:
When branch mining, you could use a Netherite tool. If you're up against the blocks, you won't need the further reach you get with diamond, so you can sacrifice it to mine faster. However, if you're building, it might not be as important to break blocks as efficiently as possible. You could instead opt to use a diamond tool to get to further blocks.
Using Netherite armor and weapons , with their higher defense, knockback resistance, and harder blows, could encourage you to use it in close quarters, where you're forced to be close to enemies. You could use it high in the nether or in caves, where you don't have very much room to move in the first place, so you can tank hits and wont be tossed around as much (thrown off a cliff, into lava, etc.). Diamond could be used where you have space, it could give you the opportunity to get in and out of danger quickly, while dealing lighter blows at a safer distance.
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