I just came across this:

You cannot use "insta", "gram" or "Instagram" in your company or product name.

on the instagram API platform policy, https://www.instagram.com/developer/

I am wondering: how can they do that? how can they forbid one from using such general terms (i am referring to gram and insta) in a product or company? It is logic to think that they would reject an application that is called in this way and uses their API but the statement seems to be more generic..

update: I don't have an instagram app or else in the works, i just want to understand how it works