Are there any open source sprite format?

PNG just plainly sucks. I has no support for animations, timing or delta compression and sequence names. Also, PNG is slow at random access (you have to decompress image before use). Proprietary formats (like Diablo 2 DCC) are much better, but highly specialized for their games: some have no true color, other have no directions.

>>33
You can always convert 8-bit paletted images to 32-bit RGBA during preprocessing when packing your data for your final build, while using 8-bit for development and you get the exact same result as you would had to tried to manually do a pallete lookup per pixel in code.

As for color cycling/recoloring, I suppose those are valid reasons if your an amateur and your head is still stuck in 1990s development techniques, but on modern hardware, even a 2002-2003 era SM 2.0 pixel shader from DX8/GL2 could easily handle that and allow you to do so much more when it came to implementing special effects while letting you work with 32-bit RGBA sprites.