Water heaters can be very dangerous when pressure builds up. One of the features build in water heaters is a TPR valve. The TPR, or temperature/pressure-relief, valves are installed on water heating appliances, such as boilers and domestic water supply heaters. TPR valves are designed to release water when temperatures or pressure inside the unit pressurize above safe levels of functioning. The way the water heater discharge pipe in the picture is installed is dangerous.
Discharging a water heater discharge pipe to a location where the leak or drip cannot be observed is not recommended. Not having the end of the water heater discharge pipe visible could allow a leak to go unnoticed for long periods of time. This could cause a homeowner to not recognize the unsafe condition of the unit. The water heater discharge pipe should be installed using proper materials and should terminate 6 inches away from the floor.