It is copyright infringement - but it was you who promoted the production of the copyright violations who is at fault. The model isn’t specifically any more a copyright violation than a browser cache or a photocopier. The person who uses the machine to produce violations is at fault, not the thing that in addition to legitimate transformed works can be used to produce copyright violations. As a company hosting such a service my goal would be similar to YouTube where I do a best effort to monitor for violation and guard rail the best I can. But I shouldn’t be held liable for your intentional use of a product for ill so long as I did do that best effort.