Looks useful, congrats on the launch!. One thing, since the page says you're not uploading images to your server(s) - you might want to rename the "Upload the screenshot" button to something that reflects that. Good luck!
Replacing it by something like 'insert' does not feel accurate either but I'm not a native english speaker. Is there any synonym to 'upload' or 'insert' that would make more sense in this case and make it clear that everything is handled client-side?
Maybe they mean they are not storing it permanently on disk. The upload is still happening, right? Or is it all being done in browser with JavaScript?
I'm using client-side JS to create the image on a HTML canvas element and turning that DOM element into an image. Server-side rendering would be easier since you don't have to deal with browser compatibility issues but I think there are enough websites collecting whatever data they can from you. No need for more ;)