On iOS, risn't now if you copy an image from a website or another app and try to paste it into paper, it gives you a text box saying "User uploaded image:", instead of the actual image.
This feels like a bug. Almost every other rich content editing apps allow pasting an image, google docs, Apple mail, messages, etc, even desktop browser version of Dropbox Paper supports that correctly.
This problem is quite anoting since now you can't quickly add an image you find on a website or something you draw with another sketching app (sometimes sketching an image or diagram is important). A workaround is to save the image to camera roll and then insert the image from camera roll in Paper, but (1) inserting image is a 2 step process where you have to choose between take a photo vs from library, (and sometimes 3 steps since you have to choose a folder from photo library); (2) having to save a temporary image into photos clutters your photo library (and probably also your google photos library if you have auto upload there) since these are just temp images meant to be embedded into notes but not for photo libraries.