LÖVE

I made a video with alpha transparency to overlay it on another video. I wanted to do this to make layers animated backgrounds through video.
I know this might be weird and ineficcient, I'm already thinking of easier solutions I'm just curious at this point if it's possible in love 2D.

here's what I'm trying to overlay.

Hello!

I made a video with alpha transparency...

Wow!! How did you do that?
There are surprisingly few video file formats that can contain alpha channel.
Love2d supports only OGV video format https://love2d.org/wiki/love.graphics.newVideo
Just googled it for a bit and couldn't find something about alpha channel inside Ogg Theora.
Are you sure your file contains alpha channel? Can you share it here (not a .gif but .ogv)? Can you see this transparence in some player software?

A few month ago I was looking for some way to store animation with alpha-transparency and found only apng format for me. A good question about supporting it in Love2d

And if the is no such options, then I suggest 2 separate videos: one with color + one with alpha along with simple shader will be simplest solution for your task.

Alternatively, if you can sacrifice some shades of black, for instance, you could just use that one video (encoded as an ogv without an alpha channel i mean) and use a simple shader where you discard / draw 100% transparent where the video pixels are below a combined rgb threshold (i'd say 0.0,0.0,0.0 but depending on video quality, that may be too steep of a threshold, experiment)

OKAY. So I was using blender to export video with an alpha channel. after some testing it turns out .ogv doesn't have an alpha despite blender suggesting otherwise. Iused the following settings to export the ogv and the alpha did not work.
.MPG4 does support aplha channel but does not work with Love 2D of course.

Thanks for the suggestions, I'll experiment with those concepts.

Thanks for sharing blender settings!
Transparent videos is a truly mysterious mysteries in our world