4.8 is almost GA, and this bug doesn't rise to the level of things that will get stuffed in at the last minute.  We'll fix in 4.8.z once we get to the point of landing low-severity bugfixes.

Using pre-merge build to run this verification, and get passed.

[root@preserve-jialiu-ansible ~]# oc get co network
NAME      VERSION                                                  AVAILABLE   PROGRESSING   DEGRADED   SINCE
network   4.8.0-0.ci.test-2021-07-13-030431-ci-ln-ny1cyfk-latest   True        False         False      48m
[root@preserve-jialiu-ansible ~]# oc edit proxies.config.openshift.io
proxy.config.openshift.io/cluster edited
[root@preserve-jialiu-ansible ~]# oc get proxies.config.openshift.io cluster -o json
{
    "apiVersion": "config.openshift.io/v1",
    "kind": "Proxy",
    "metadata": {
        "creationTimestamp": "2021-07-13T05:29:08Z",
        "generation": 2,
        "name": "cluster",
        "resourceVersion": "40145",
        "uid": "7c6476f1-3362-45ca-9df8-e975848cd663"
    },
    "spec": {
        "httpProxy": "proxy-user1",
        "httpsProxy": "proxy-user1",
        "noProxy": "test.no-proxy.com",
        "trustedCA": {
            "name": ""
        }
    },
    "status": {
        "httpProxy": "http://proxy-user1:JYgU8qRZV4DY4PXJbxJK@10.0.0.2:3128",
        "httpsProxy": "http://proxy-user1:JYgU8qRZV4DY4PXJbxJK@10.0.0.2:3128",
        "noProxy": ".cluster.local,.svc,10.0.0.0/16,10.128.0.0/14,127.0.0.1,169.254.169.254,172.30.0.0/16,api-int.jialiu1980411.qe.gcp.devcluster.openshift.com,localhost,metadata,metadata.google.internal,metadata.google.internal.,test.no-proxy.com"
    }
}
[root@preserve-jialiu-ansible ~]#  oc describe co network
Name:         network
Namespace:    
Labels:       <none>
Annotations:  include.release.openshift.io/ibm-cloud-managed: true
              include.release.openshift.io/self-managed-high-availability: true
              include.release.openshift.io/single-node-developer: true
              network.operator.openshift.io/last-seen-state: {"DaemonsetStates":[],"DeploymentStates":[]}
API Version:  config.openshift.io/v1
Kind:         ClusterOperator
Metadata:
  Creation Timestamp:  2021-07-13T05:29:13Z
  Generation:          1
  Managed Fields:
    API Version:  config.openshift.io/v1
    Fields Type:  FieldsV1
    fieldsV1:
      f:metadata:
        f:annotations:
          .:
          f:include.release.openshift.io/ibm-cloud-managed:
          f:include.release.openshift.io/self-managed-high-availability:
          f:include.release.openshift.io/single-node-developer:
      f:spec:
      f:status:
        .:
        f:extension:
    Manager:      cluster-version-operator
    Operation:    Update
    Time:         2021-07-13T05:29:14Z
    API Version:  config.openshift.io/v1
    Fields Type:  FieldsV1
    fieldsV1:
      f:metadata:
        f:annotations:
          f:network.operator.openshift.io/last-seen-state:
      f:status:
        f:conditions:
        f:relatedObjects:
        f:versions:
    Manager:         cluster-network-operator
    Operation:       Update
    Time:            2021-07-13T05:35:21Z
  Resource Version:  40147
  UID:               bae49eb1-723c-44ff-a8d7-62e0f08f1d1e
Spec:
Status:
  Conditions:
    Last Transition Time:  2021-07-13T06:24:53Z
    Message:               The configuration is invalid for proxy 'cluster' (invalid httpProxy URI: parse "proxy-user1": invalid URI for request). Use 'oc edit proxy.config.openshift.io cluster' to fix.
    Reason:                InvalidProxyConfig
    Status:                True
    Type:                  Degraded
    Last Transition Time:  2021-07-13T05:34:27Z
    Status:                False
    Type:                  ManagementStateDegraded
    Last Transition Time:  2021-07-13T05:34:27Z
    Status:                True
    Type:                  Upgradeable
<--snip-->
[root@preserve-jialiu-ansible ~]# oc get co network
NAME      VERSION                                                  AVAILABLE   PROGRESSING   DEGRADED   SINCE
network   4.8.0-0.ci.test-2021-07-13-030431-ci-ln-ny1cyfk-latest   True        False         True       52m
[root@preserve-jialiu-ansible ~]# oc adm upgrade
Cluster version is 4.8.0-0.ci.test-2021-07-13-030431-ci-ln-ny1cyfk-latest

warning: Cannot display available updates:
  Reason: VersionNotFound
  Message: Unable to retrieve available updates: currently reconciling cluster version 4.8.0-0.ci.test-2021-07-13-030431-ci-ln-ny1cyfk-latest not found in the "stable-4.8" channel

It does not complain about the proxy URI, using staus for that.

Waiting on the patch manager to fit it into the 4.8 queue.

Per comment 3, move it to verified.

Since the problem described in this bug report should be
resolved in a recent advisory, it has been closed with a
resolution of ERRATA.

For information on the advisory (OpenShift Container Platform 4.8.12 bug fix update), and where to find the updated
files, follow the link below.

If the solution does not work for you, open a new bug report.

https://access.redhat.com/errata/RHBA-2021:3511