Instagram is testing out the "Closed Caption" feature for stories. This will transcribe the audio in your stories. This feature appears in the sticker tab, just similar to that is available in Thread App.
This new Instagram Stories feature was spotted by Matt Navarra who shared a video demonstrating the feature on Twitter. So, basically, you can tap on the sticker icon and select the captions sticker once you are done shooting the video. Instagram will use some algorithm and will auto-caption whatever you have said in the video. There are also four font option from which user can choose for caption and also the colour of the text can be changed.
This feature is currently showing up for a selected user. Instagram also confirmed that this feature is not available for public testing, it might be some glitch on their side that this feature is visible to some users. Instagram introduced something similar last year with the Threads app. Here, the app automatically adds captions to every video recorded. You can then remove the captions, or edit each word. You can also move the captions around the video and place them where you want. This feature isn’t available to all Threads users but there has been quite a lot who have posted the captioned videos as Instagram Stories.