Pretty much consistent when you upload a .gif file for OCN to compress.
Upload a .gif file, and compare the quility to the original file. It'll usually be quite poor.
Here is the comparison between the original file for my avatar, and the result when uploaded (OCN version on the left):
The .gif files to retain their quality a bit better.
Might also affect transparent .png files not working correctly (the backgrounds becoming black after the upload, etc).
More examples available in this thread: