Can I use SIPS to reduce the size of PNG files by reducing the number of palette colors? I need to shrink PNG files like the ones generated as the default macOS screenshot. SIPS was my first stop since it's faster than any other solution but I haven't quite been able to find the right command.

This is my starting point to reformat to PNG:

/usr/bin/sips -s format png  "$f" --out "${f%.*}.png"


Which options are needed?

--setProperty bitsPerSample 


Bits/sample looks promising but I'm not sure what to enter here. 
Does 32 mean 32 colors in this context, for example?

Can I use SIPS to quickly reduce the number of colors to shrink file size?
As far as I know, bitsPerSample is a read-only property and you cannot modify it through sips. You can use ImageMagick instead. Consult https://stackoverflow.com/questions/11613105/uncommon-png-file-ios-display for more info. Hope this helps. Recently encounter a similar thing.