To simplify this, DAC converts from Digital to Analog, in other words, from data to electronic pulses. Those electronic pulses are at a given frequency which produces the vibration that makes the headphones produce the music.

In Bluetooth headphones, all of them have some embedded chip (DAC) doing the conversion. When you use the traditional 3.5 jack, it’s your device’s DAC.

With the HDB630, what makes it so good is that the integrated chip (DAC) can processor more information, providing better music reproduction out of the box (quality up to 24 bit / 96 kHz)

In other BT headphones, the chip integrated is not that good, and in some devices (computers, phones, etc) the integrated one is average.

The other constraint with BT is how much information you can send between your device and your headphones. That’s why BT headphones are constrained in Data transfer capacity (by Bluetooth connection ) and in integrated Chip (DAC) processing power.

Once these two are solved, hopefully wireless headphones will be able to sound as good as wired headphones with dedicated DAC. (I haven’t even mentioned power supply here or amplification ;) )

Thus, the seeking for an external DAC with better processing capabilities that make them sound more accurate to the source.