The chip (not to be confused with the green circuit board on which all the components are attached) is actually the brain of a dashcam. After light enters via the image sensor, just like in the human eye, it has to be processed into a perceptible video that is as representative of reality as possible. Here, of course, the quality of the sensor is decisive for the final image quality.

Ambarella vs Novatek

Together with the image sensor, the quality of the chip and components determines the dashcam's performance and image quality. This is because the images come in through the image sensor and are then processed into digital video in the processor.

The two most common brands of chips in dashcams are Ambarella and Novatek. One brand is not necessarily better than the other, just like you cannot say BMW is better than Mercedes or Audi (although opinions will differ on that).