A conic equation of the type of Ax^2+Bxy+Cy^2+Dx+Ey+F=0 is rotated by an angle theta, to form a new Cartesian plane with coordinates (x',y'), if theta is appropriately chosen, we can have a new equation without term xy i.e. of standard form.

The relation between coordinates (x,y) and (x'.y') can be expressed as
x=x'costheta-y'sintheta and y=x'sintheta+y'costheta
or x'=xcostheta+ysintheta and y=-xsintheta+ycostheta
for this we need to have theta given by cot2theta=(A-C)/B
In the given case as equation is x^2-4xy+y^2+1=0, we have A=C=1 and B=-4 and hence cot2theta=0 i.e. theta=pi/4
Hence relation is give by x=x'cos(pi/4)-y'sin(pi/4) and y=x'sin(pi/4)+y'cos(pi/4) i.e.
x=(x')/sqrt2-(y')/sqrt2 and y=(x')/sqrt2+(y')/sqrt2
Hence, we get ((x')/sqrt2-(y')/sqrt2)^2-4((x')/sqrt2-(y')/sqrt2)((x')/sqrt2+(y')/sqrt2)+((x')/sqrt2+(y')/sqrt2)^2+1=0
or ((x'^2)/2+(y'^2)/2-x'y')-4((x'^2)/2-(y'^2)/2)+((x'^2)/2+(y'^2)/2+x'y')+1=0
or -x'^2+3y'^2+1=0 or x'^2-3y'^2=1
The two graphs are as follows:
graph{x^2-4xy+y^2+1=0 [-10, 10, -5, 5]}
and
graph{x^2-3y^2=1 [-10, 10, -5, 5]}