A 1-bit DAC (sometimes called Bitstream converter by Philips) is a consumer electronics marketing term describing an oversampling digital-to-analog converter (DAC) that uses a digital noise shaping delta-sigma modulator operating at many multiples of the sampling frequency that outputs to an actual 1-bit DAC (which could be fully differential to minimize crosstalk).[1] The combination can have high signal-to-noise and hence an equivalent effective number of bits as a DAC with a larger number of bits (usually 16-20).
The advantages of this type of converter are high linearity combined with low cost, owed to the fact that most of the processing takes place in the digital domain, which helps relax the requirements for the subsequent analog low-pass filter (for anti-aliasing image frequencies and suppressing high-frequency noise-shaping noise). For these reasons, this design is very popular in digital consumer electronics (CD/DVD players, set-top boxes and the like).[2]
While single-bit delta-sigma DACs have an advantage of a much simpler internal DAC, multi-bit delta-sigma DACs have the advantages of a simpler digital noise-shaping loop, less dithering, a much simpler analog smoothing filter, and less sensitivity to clock jitter, so generally the advantages of multi-bit truncation outweigh single-bit truncation.[3]