Meta calls Threads an “app from Instagram” that was built by the Instagram team. However, the use of a shared login also avoids certain potential future dramas about user privacy.
For example, people are likely to feel a certain “ick" factor on knowing your WhatsApp, Facebook, and Instagram accounts are almost inseparably linked. Meta uses data from each to build up your advertising ID, letting the company better target ads through its advertising platform and therefore make more cash.
By sharing the login details between Threads and Instagram, this becomes almost intuitive and, therefore, much less likely to cause a ruckus. On the positive side, it also makes setting up your first wave of followers and following folks much, much easier.