Was this feature not a thing 3 years ago? I don’t know why it bothers me, but I wish they would add some banners for their more active communities. It makes it just a little bit more official looking.
Edit: I believe the instance itself is also lacking a banner.
I tried uploading a banner for a community I mod and was met by a JSON parser error message, so that’s not happening there until there have been a few more updates.
That JSON parse error may actually be due to your image being too large. Try resizing to under 1MB and see if that works. That’s the fix for my instance, anyway.