"Normal Quality" image compression looks bad!!!

I just compared identical images in 2018 and 2019 editors, and quite frankly the 2019 looks really bad.

This is what I see in 2019 (notice the rainbow effect):

By changing the setting from "Normal Quality" to "Low Quality" also doesn't change. So maybe the "normal compression" mode was removed?

In both editors I had compression set to "Normal Quality" and only 2018 looked smooth and without crazy rainbow colors.

Do I have to change every single image in my project to "high quality" so they look like 2018 did?

Here's the original image:


Why are the default images so bad now?

 

How does normal look in 2018?

 

Rainbow effect only slightly apparent, but I never noticed it. It was nothing like what I'm seeing in 2019.

 

I believe it's a regression. I submitted a bug-report for the issue:
(Case 1132906) 2019.1: Color banding with "Normal Quality" texture compression

 

Unity QA was able to reproduce the issue and it's been added to the public issue tracker:
https://issuetracker.unity3d.com/is...y-more-color-banding-than-in-unity-2018-dot-3

 

Just a heads up, it should be fixed in 2019.3.0a2, according to the changelog:

https://unity3d.com/unity/alpha/2019.3.0a2