I believe that callback URLs are similar to callback function which when provided to an API will be called by the API when a certain event occurs or after certain requests. I went through the documentation but was unable to find when the callback URL in imgur will be called. Could you please let me know the scenarios in which the callback URL will be called and if I do not need it, how to opt out of it ?
If you are referring to the callback URL entered during app registration, that is used when authenticating a user. IF someone uses your Oauth2 link, they will be redirected to your callback URL after they sign in and that URL contains the access token which is what you need to use the API as a logged in user. This contains information about authorization.