Overwolf's launcher seems to include some kind of in-game overlay and it will fail to restore the OpenGL context state when it returns from the render flip hook. This causes severe problems since Minecraft caches the bound resources for pipeline texture slots and does not know when the overlay software has modified them. Most commonly, the result is that terrain renders as some random color, due to the light texture slot being bound to the incorrect texture.

I'm not in the mood to try and reverse engineer their software and figure out how we can mitigate the bug on our side.

Unlike other overlay software (RTSS, MSI Afterburner, ASUS GPU Tweak, etc) it doesn't seem to be such a big deal if users are asked to turn it off. Frankly, after reading their website, it is difficult to understand what it even does.

So I am just going to add it to the module blacklist in the mod and focus on more important bugs.

No need to reverse engineer or anything like that :)
Overwolf human person here.
We've known about this but we're unable to reproduce it,
It would be cool if you could please either let me know how to reproduce or connect me with someone who can reproduce it, We've been trying for over a week to reproduce this now..

edit:
reproduced, working on a fix.

edit 2:
fix is being tested now. We accidently set glActiveTexture twice in some cases