@Andreas_Hegenberg The bug is now fixed after I updated to 12.5.1!
I'm going to provide more details in case it's useful for you or for anyone else who is also experiencing this bug (N.B. I do not know if any of these actions helped in resolving this issue):
- I determined that Markup also wasn't working in the native Notes app. After pasting an image in the Notes app, I hovered over the image to try to select the Markup option. However, the Markup option didn't appear – only the "More" option. When I clicked on the "More" option, Notes crashed. Andreas suggested to try this troubleshoot in this post: Edit Image option in Clipboard does not work - #3 by Andreas_Hegenberg.
- Next, I saw that the "Markup" option wasn't even showing up under System Preferences/Extensions/Actions.
- Some posts online suggested that this issue is related to MacOS' QuickLook feature and clearing the cache by running
qlmanage -r cache
in the terminal would resolve the issue. Quick Look not Working after Upgrading to macOS Monterey? - macReports - Running this command didn't resolve the edit image bug in BTT. However, now BTT was producing a crash report!
- After updating from MacOS 12.3 to 12.5.1, the bug is now resolved.