(This solution also works for those whose window has shrunk and are not able to restore the full screen setting)
1. The problem is solved by resetting your resolution settings.
First, please make sure Battlerite is closed.
Open your files folder and type %appdata% in the directory line. Press enter.
Open the Battlerite folder and then the file "Graphics.json" with Notepad.
Please try to change the resolution in that file by deleting the text and replacing it with the following code:
This would be for a monitor with a resolution of 1920x1080. Please adjust the parameters to fit your monitor's resolution.
Save the file and launch the game.
If it doesn't work to just change the resolution in the file, you also have to turn off sync cloud on Battlerite.
2. You can find the option in Steam > Right click on Battlerite > Properties > Updates > Remove the check mark from "Enable Steam Cloud synchronization for Battlerite".
3. After the game launches correctly, please go to More > Options > Graphics > Resolution
Choose your desired resolution and go back to Steam without closing the game.
4. Again, right click on Battlerite > Properties > Updates > Check back the mark on "Enable Steam Cloud synchronization for Battlerite". The new resolution should save in the cloud from now on.
If the error shows up again, please repeat the process and skip step 4 this time.