Not a bug, pasting images into the terminal is not supported, do not do this, that's not what the terminal is for or how it is used. The standard way is to pass the path of a file to the program as a runtime parameter or in some config file.
Terminals are not alternative web browsers/graphical application sandboxes.
Sixel came out in the 80's as a way to print on dot matrix printers. If your terminal doesn't support that yet, you might want to look into updating your software.
So basically don't use Claude Code is your suggestion. Not very helpful, guy.