This is a simple but cool concept. Makes it really easy to hotlink pictures, even for newbies.
Simple solution to a boring and tedious problem.
I wonder how he does it backend to not eat up too much bandwidth and storage? Probably the url to the picture is stored, and cached for a duration of days, and when the picture goes stale, or is considered too old and not interesting, it's released from the cache.
It would be interesting to see what kind of statistics and reports will end up on the page after a while. I guess the first thing now is to build some momentum and build up and index, and then we will see if the reports are interesting. Maybe they are trying to make something like Digg, but for pictures... Who knows...?