In addition, if you happen to have a slow connection, all you see is blurred blobs instead of pictures. I never experience that with proper img tags because, you know, most major browsers have been doing progressive loading (which works with basic img tags) since several years ago and it works very well in most cases. I don't see why the guys at Medium felt they needed to reinvent the wheel. I hate Medium's layout and since they allow custom domains it's becoming very hard to avoid Medium links at all.
Checking the source the class is "progressiveMedia js-progressiveMedia graf-image" so in essence they don't use <img> tags for control. They could add in <noscript><img/></noscript> though.
At times I feel filling the building with just a few too many smart people can sometimes cause a regression on experience as things are over engineered and too many people struggle to find smarter solutions to solved problems.
Take Google Maps for example, the old tile based version is blazing fast and uses almost no CPU. "Modern" version of Maps makes my MacBook Pro fans turn on almost straight away, chugs and chokes when dragging and although the zoom motion is clearer the actual data display isn't any better.