Why can't image files in the media library be moved into folders?

Images or media files uploaded to the Media Library create a hosted path to the file so that the file can be seen/used in an email to your recipients. 

The hosted file path is created when the file is uploaded. An image/file path does not update when an image or media file is moved. Moving an image or media file would cause the hosted file path to break and create a poor subscriber experience if that image or media file is used in an email - causing broken images and hyperlinks.

To keep this from happening, images stored in the Media Library in your Assets dashboard cannot be moved into folders after upload. Placement in folders must occur at the same time of the file upload.