This is a classic limitation of the GIF format—unlike PNG, GIF only supports a single color as transparent and does not have an alpha channel with varying opacity. This means smooth transparent edges and anti-aliased shadows are basically impossible in GIFs, which can cause jagged edges when placed on different backgrounds.

A modern approach is to use WebP instead of GIF. WebP supports full alpha transparency with variable opacity and animation, plus better compression. It’s now widely supported across browsers and platforms, making it a great alternative to GIF for animated images with smooth transparency.

If you need to convert between these formats or make stickers, check out my app WebPeek which offers efficient GIF-to-WebP and WebP-to-GIF conversions, maintaining transparency and animation as much as possible.