Minecraft 1.16.4 is a minor update to Minecraft 1.16 Java Edition released on November 2, 2020. Minecraft 1.16.4 update adds the social interactions screen and fixes some of the bugs.
With chat update you can now hide matched Minecraft usernames, some Minecraft servers send chat messages in non-standard formats. With this option on, Minecraft client will attempt to apply chat hiding anyway by matching the text in ingame messages.
Minecraft 1.16.4 also adds new social interactions screen that gives players the ability to disable chatting with certain players, thus hiding any messages received from them, which is essentially what chat update is.
In Minecraft 1.16.4 social interactions screen opens with a configurable key binding, by default that's P. Whether a player is hidden resets when re-joining Minecraft server. The status of a player is listed below their Minecraft username.
There were also a few "cosmetic" changes, for example Netherite leggings texture was updated. Also Minecraft server and client version mismatch is now properly shown as error message.