The Bits System is a puzzle piece function in the game, released in Part 3 of the Unlimited Update. It requires you to collect Bits and insert them into Bit Cases. Only one Bit Case can be open at once, and provides the frame for the Bits to be placed in. Some images will require a larger Bit Case.
Each Bit will give a certain amount of stats, and they can give set effects for gathering more Bits of the same picture.
The Bits UI can be accessed through the inventory UI, as well as a hotkey.