Pixelation by itself does not produce any camo effect. It just happens to be easier and cheaper to produce fractal camo patterns on clothing out of pixels - it can be literally printed. And at any range at which the pattern is likely to work anyway, the individual pixels aren't really visible.

More modern (and expensive) patterns like Multicam or A-TACS do the same thing without pixels, e.g.: https://www.camopedia.org/index.php/File:Multicam.jpg