How Do I Setup Microsoft Visual Studio: Code as a Default Editor?

From Microsoft VSCode's Doc

Setting VS Code as the default text editor

xdg-open

You can set the default text editor for text files (text/plain) that is used by xdg-open with the following command:

xdg-mime default code.desktop text/plain

Debian alternatives system

Debian-based distributions allow setting a default editor using the alternatives system, without concern for the mime type. You can set this by running the following and selecting code.

sudo update-alternatives --set editor /usr/bin/code

Additionally, there is issue mention following

Some need you to set the default for a mime type like:

~/.local/share/applications/defaults.list

[Default Applications]
text/plain=code-insiders.desktop
Which adds Open With Visual Studio Code - Insiders (Ctrl+O) to the nautilus context menu.