The thread is taken from the cocoon before the moth fully passes through the chrysalis phase. This process kills the moth, so obviously not every chrysalis is taken.
The colour of the silk depends on what the caterpillars were fed. They require green leaves, and are generally fed on mulberry leaves which give a very pale blonde or white, depending on species. If the diet is supplemented with rose petals, the thread can come out with a pink tinge.
The thread is either spun or used flat.