Comment by nickmqb

Most textures look fine despite the 4-bit quantization, but color artifacts/hue change do become more apparent when multiplying with a light factor (to darken the textures on the bottom and sides of blocks), so I'd say 4-bit is definitely pushing the limit. 6 bits or even 8 bits per color component would be ideal, though unfortunately on a small FPGA like this we cannot afford such luxuries ;). It is probably the first thing I'd change if I were to port this to a larger FPGA, since it would be pretty straightforward to do and the increase in visual quality would likely be worth it.