Valheim uses state of the art effects and raycasting. They can get modern computers starting to sweat if you crank them all up.

Hardly "potato game". Just because the graphics itself are a certain style, doesn't mean the game can't be demanding. Especially when it is relatively unoptimized due to still being in development.

Edit: Try turning all the effects off and then look at it. Quite primitive, and will run well on older hardware. Crank all the effects up and even better GPUs will start running hot.