1. A method for performing motion estimation, comprising: converting multibit pixel values of frames to single bit pixel values; storing a previous frame of single bit pixel values and a reference frame of single bit pixel values; comparing a sum-of-absolute differences of pixel values between the reference frame and a block in a search area within the previous frame to find a best match block in the previous frame; calculating a motion vector representing the difference between the reference block and the best matched block in the previous frame; and wherein the step of converting multibit pixel values of frames to single bit pixel values further comprises the step of thresholding the value of a reference pixel with respect to a low-pass filtered average value around the reference pixel, and the value of the reference pixel is substituted by the average value of the neighboring pixels.