This simple addon will allow you to set which usergroups have the permission to upload gif avatars. Gif avatars are typically animated and many admins don't like all users to have them.
This only sets permission to upload, if you have not configured your server or XF to allow Animated gif 's then this will not change that. Typically you need to have the "Default image processor" In XF set to "Imagemagick PECL extension" and your server needs to have imagemagick PECL extention installed.