zlacker

One of the other reddit admins will likely have a better answer, but at the time I worked for them (10-11), the answer was it was a complexity the reddit team didn't want to have to deal with.

Running an image host takes a lot of effort. You have to deal with removals, content policing, and the other nasties, as well as just having to deal with the sheer volume of data, which was a much larger concern in the 2010 era internet than it is now.

Reddit at the time just wanted to focus on being a link and text post site, much like HN is.