Ohh, so that's why all animations in Quill for quest look like this.
It's actually the recommended approach for transparency in this hardware
Viewing post in solving transparency with dithering comments
It's one of the possible solutions.
I've also seen a similar approach used for PC, although there it was used to get the water to work with deferred shading. It included rendering depth info at a lower scale, using deferred shading and then mixing the results.
In the end, I decided to use dithering for PC too but mixed with alpha as it adds fuzziness to the smoke.
Also, in some cases, I decided not to use it at all. Muzzle flashes, some explosions and particles. They looked better with either scaling down or being cut sharp and clean.