Instagram is growing at an incredible rate with 80 million users. Many of those new users who are also on Twitter and want to follow their Twitter friends on Instagram will find one key feature is no more. Twitter has changed API restrictions for Instagram and has eliminated the "Find Your Friends" feature that Instagram previously offered.
It is worth noting that the "Tweet Photo" feature is still available. There is some indication that Twitter may have axed that portion of the API for Instagram over concerns of strains on twitter servers due to the massive user base of Instagram and bandwidth consumed with users pulling friends lists. However, TechCrunch reports that other social apps still have access to this part of the API, known as Twitter Friend Graph.
That would seem to indicate that Instagram was consuming more bandwidth than any of the other users of that particular part of the API. Perhaps this is a little tit-for-tat on Twitter's part now that Facebook owns Instagram. Facebook blocked Twitter access to the Facebook in-app friend Finder feature in June of 2010.