As Karaclan, whose work on VED we shared in the past, explained, they used 2D sprites positioned along the Z-axis and applied a custom shader to simulate the appearance of 3D models.
The shader works on plants and small interactive objects, though buildings may require additional layers or a slightly different approach. Apparently, it will be used in a top-down RPG with highly detailed armor customization and robust inventory management.
When asked why they didn’t simply work in 3D, they noted that this method allows for better optimization without sacrificing detail or smooth edge rendering. It also speeds up content creation for a top-down map, resulting in a unique visual style that looks 3D but is technically 2D.