Ultimately they are relying on other…

Ultimately they are relying on other people respecting the connection between the transaction and the jpg. To achieve this they need a third party agent to enforce it. Why go to the trouble of running a blockchain? Why not just have the third party run a simple database of ownership?

Decentralised ledgers are meant to remove the trusted third party. Why would an authority enforce a standard that is meant to undermine their rule?