embedded PNG Album Art in MP3's??

I noticed that when I right-click on album art in iTunes, select Copy, and the paste it into the album art box in Mp3tag, that the result is a PNG image instead of a JPG. I searched for PNG in these forums and found no reference to it. Any opinions about compatibility of PNG images when embedded in MP3 files as well as when saved as folder.png and albumartsmall.png?

This has been changed to JPG with the current Development Build.