it is the modeling of pinscreen animation technique, invented in the 1930s by Alexandre Alexeieff and Claire Parker

function "Visual instance" is not to be missed. it boosted the number of pin to 98000 (this picture is >40000) without big stress on the update! and from 277MB to few MB!!! of file size.

Parametric animation working with raytracing makes the trick, that goes beyond the resolution (pin number)! the various shades soften the result. what I find as annoying as magical is that you end up tuning brightness, contrast with the range of pin height, the pin shape, the orientation of the light, (1 light? 2 lights?) and I liked it very much. overall combination of ray tracing and parametric modeling is a must study (Cf light guides for car lamps as an industrial case....)

the logic, together with @RD 

• picture treatment
• Range of pin displacement
• transition of the pictures
• pin shape
• position of the pin on the board
• board (not explained)
• 3DText (not explained)

Picture treatment

• import picture, resize it along with the hardware power, make it grayscale like here or directly retrieve the pixel colors and get the red  or green or blue channel as "grey scale.
• there is a formula to get the brightness of a pixel instead of the color, but good enough in this case. 

Range of pin displacement and transition of the pictures

• basically I scale the red color (0 to 255) into the height of the pin on the board
• 0 -> 1mm height => little shade - bright
• 255 -> 4mm => big shade - darker 

for the transition

• the logic is: pic1 X (1-t) + pic2 X t -> t varies from 0 to 1
• height of pin for pic1 X (1-t) + height of pin for pic2 X t
• but I was too quick to model and it is not exactly as above.
• very important -> t should be used for the parametric animation!
• 

pin shape

• it is a tube with half sphere as cover
• it could be more complex for fine tuning of the brightness. but I did not make a try
• also big impact of the radius of the pin! if too big, there is no shade effect, if too small, there is no shade effect....
  • here my pixel is 1mm square
  • pin radius is 0.25mm

position of the pin on the board

• it is a translation of the origin reference system to pixel X Y and at Z as calculated before.
• Translate 3 is a reference axis, so it can be used as input for the visual instance positioning
• there is a minus.1 and lenght.2 -> I added a global offset of the pins on the board. it was useful for adjustements

ZOOMING

TRIALS  and RUSHES