God, this is frustrating. They essentially cracked Instagram's entire production environment open, and took explicit steps at every turn to stay within the published guidelines, and then they just take his report with zero compensation whatsoever. Insane.
I wouldn't really blame the guy if he decides to sell the next one on the darknet.
It's crazy that they can find a bug that would cost Instagram 1M+, yet payouts are in the thousands or maybe tens of thousands if you're super lucky.
I'm curious if it's illegal to sell exploits. Using them is obviously illegal, but is the transfer of knowledge for money illegal? I.e. I'm not allowed to build an M16, but presumably I could by the schematics for one if I wanted (I've never tried, but I can't imagine possession of them is illegal since they make posters of it and what not).