One problem that I can think of is that the palette for each frame is restricted to 255 colors. That being said, there really isn't any other widely-supported option at this point :-).
Blippy co-founder here. Yes, GIF is a really old format. We have to work a lot on optimizing for performance. Surprising that it is the only popular one that allowed any animation. Others like Animated PNG did not take off.
yup, we had to tradeoff controls, buffering, audio, and filesize for ubiquity of consumption and simplicity of user experience (i.e. inline/autoplay). Have you tried gifs in an iMessage? They're really fun to add to your texting!
I like the app concept! Nice work!