Overwolf will select the codec for you automatically, based upon which codecs are available to your machine.
The selection of the codecs follows the above priority. You can change this setting by going into the "Capture" settings by clicking on the small wrench icon on the video recorder.
x.264 is a software encoder that is always available.
Hardware encoders, such as Intel Quick Sync or NVidia NVENC are only available to computer systems that have the appropriate hardware components.
If you think you have the hardware to utilize one of the hardware-based encoders but do not know how to enable them, please click the above links.