It's a conscious design decision and actually almost all people with a dedicated GPU can run this game regardless on how much VRAM they have. Of course it will run better if you have at least something that is not older than, say five to six years.

If you have at least four GBs of VRAM you can even use the Willybach textures. I've tried it and it worked fine.

Edit: Any MY opinion is that default Valheim looks gorgeous. And now? It's your opinion vs. mine. Nobody's right. It's a matter of taste.