if you have a telnet connection to a server using only LFs any terminal protocol (xterm,kterm,vt100) does not make correct new lines.
It just makes a new line but it does not start at the beginning of the line.
Telnet server will echo back LF, and the LF code moves the cursor as you saw.
It is not a bug. You should use CR+LF to conform to the telnet protocol.
However, I have checked the source code, and I found another issue.
Currently, CR+LF is sent as CR+NUL+LF, so CR+LF mode may not work correctly.
I will fix it.