Really? What? REALLY?! Well not in my browser… but could you please report what are your OS (Windows) and browser in the following ticket?
Chrome at least used to allow this in Windows (but sadly not in Linux)
It’s not that relevant to the ticket though, to solve that ticket there should simply be a URL upload option, this is a workaround that only seems to work on Windows.
I'm guessing that Windows simply downloads the given URL in the background and then "replaces" the local path of the downloaded file in the URL. I guess this might be possible to do in an extension of some sort for Firefox (and maybe Chrome et al too). Maybe even a userscript.
Yes, that’s probably what happens. As you can see the image is downloaded to an Internet Explorer temp folder. All the other images you see there were added in the same manner earlier.
I’m not sure how userscriptable that is for other operating systems.